U.S. President Barack Obama

"Cuts to winter heating aid concern New Englanders"
By Glenn Adams, Associated Press, August 14, 2011

AUGUSTA, Maine—It's been so hot this summer that heat records in some parts of New England melted away with temperatures in the 100-degree range. At the same time, the frigid days of the winter ahead are on the minds of officials in the region's statehouses.

As July went on record the warmest month on record in Portland, Maine, Barack Obama's proposal to chop the budget of the Low Income Home Energy Assistance Program nearly in half hung eerily in the background. Amid the simmering heat, Gov. Paul LePage had some chilling news for people attending a Capitol for a Day meeting in Dover-Foxcroft.

LePage warned that Maine's LIHEAP funding from the federal government could be cut in half, from $54 million for this year to about $26 million. He noted that the reduction could come as the cost of heating fuel rises above last year's level.

An organization that follows those trends agrees. The National Energy Assistance Directors' Association says the average cost of heating a home in New England with oil will be about $2,983 this winter, nearly $650 more than last year. High unemployment and colder-than-average winter temperatures exacerbate the problem for poor families, it notes.

While the president presented his budget in February, congressional review of the allocations is not expected before September. Given past experience, the cuts may not be as severe as states now fear, and the administration has said it's willing to revisit the figures.

In Maine, LePage has pledged to do all he can, despite the state's tight fiscal environment, to prevent people from freezing this winter if the worst comes true.

While it's never too early to think about funding for a program that's critically important in chilly New England, preseason jitters over the program are an annual occurrence. And the usual pattern is for funding to come through -- after pressure is applied from lawmakers from cold states.

"Every president in the last 15 years has proposed cuts in LIHEAP. It's not unusual to see a president knock LIHEAP around," said Richard Moffi, fuel assistance program chief for Vermont, which is looking at a cut in heating assistance from $25.6 million to $11.6 million. "Congress usually comes along and they hold the line."

And as of now, Obama's proposal to cut LIHEAP in half from about $5 billion is just a proposal, says Kirston Figueroa, director of energy and heating services for Maine State Housing, which administers heating assistance.

"It's such a moving target because we never really know until we know," Figueroa said.

Celeste Lovett, New Hampshire's fuel assistance program manager, agreed. Federal figures show New Hampshire's LIHEAP funding could be cut from $36 million to $15 million.

"It's really too soon to tell," Lovett said. "What we've done in New Hampshire is go forward with taking applications."

In Connecticut, the allocation would drop from $98 million to $41 million, Massachusetts from $175 million to $81 million, and Rhode Island from $34 million to $15.4 million.

New Hampshire started accepting applications in mid-July from vulnerable households -- those with residents over age 60, under age 6 or people with disabilities. The application process starts for the general public on Sept. 1.

The Obama administration, questioned about the proposed funding cut, acknowledged that the new LIHEAP figure was based on the expectation that fuel prices would be lower this winter. But in northern New England, they're expected to be in the $4-per-gallon range.

That affects a lot of families. About seven in 10 New England homes use heating oil, the University of New Hampshire's Carsey Institute says. Federal figures from 2007, the latest available, show that just over 355,000 households in the six New England states received LIHEAP assistance.

Federal officials say that the LIHEAP budget proposal for fiscal 2012, which starts Oct. 1, is $2.6 billion. That compares to $4.7 billion for the current fiscal year, said Kenneth Wolfe, a spokesman for the federal Department of Health and Human Services Administration for Children and Families.

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"Kerry asks gov't for heating funds"
By Scott Stafford, Berkshire Eagle Staff, October 15, 2011

While in the midst of budget negotiations for fiscal 2012 in the Joint Select Committee on Deficit Reduction, commonly known as the supercommittee, Sen. John Kerry has asked President Barack Obama to set aside $5.1 billion for heating aid in 2013.

That is the level at which LIHEAP was funded in fiscal 2010.

"In light of new and alarming projections about the cost of home heating oil in New England this coming winter, I am writing to appeal early in the budgeting process for special attention to the Low Income Home Energy Assistance Program (LIHEAP) which, as you know, has sustained severe and damaging cuts over the last several years despite a growing need," Kerry wrote in a letter to the president.

Meanwhile, local families and aid agencies are closely watching the price of energy and the thermometer as winter starts closing in. And unless someone acts soon, many local families could find themselves living in the cold.

According to Don Atwater, executive director of the Berkshire Community Action Council, the status of LIHEAP funding for this coming winter is daunting.

"With the federal deficit and the supercommittee, we have no idea what is going to happen this year," he said.

Since the fiscal 2012 budget has not been set, federal programs are funded at 2011 levels through a temporary budget continuance resolution passed by Congress until Nov. 16, Atwater noted. After that, Congress will have to pass another continuation or allow federal programs to end.

The supercommittee was formed to cut $1.5 trillion from the federal deficit as a condition of a compromise budget bill passed by Congress and signed by the president in August. The six Democrats and six Republicans have until Nov. 23 to come up with a plan.

Until then, the fate of the LIHEAP program and its funding will be unknown.

At current funding levels. Atwater noted, the roughly 11,000 Berkshire County applicants for heating aid will receive about $400 in heating aid, Atwater said. Last year it was $1,100 per household.

At that rate, he added, this year’s funding will be exhausted by November, but he is hoping Congress will infuse the program with more cash before that happens.

"Serving on the Joint Select Committee for Deficit reduction, I am particularly aware of our difficult budget situation and the need to make difficult choices now and in the future," Kerry wrote in his letter to the president. "However, I want to stress, as you have, that it is wrong to disproportionately squeeze programs that are a lifeline, literally, for seniors and the working poor who have already been disproportionately hurt by the economic conditions of the last years."

Kerry noted that there are more than 880,000 households in Massachusetts that use home heating oil "to survive our harsh winters -- and with the increase in prices we are already seeing many of them apply for assistance."

Estimates show "the average household will have to spend $2,493 this heating season compared to $2,300 last year," Kerry wrote. "Given these limited family budgets, cuts would mean many may have to choose between heating their homes, cutting back on medications or feeding their families. These are choices American families should never have to make, even in a time of fiscal restraint. Home heating oil is too critical an issue of economic survival for many in New England to have it fall in the order of federal priorities."

According to Chris Farrell, spokesman for Berkshire Gas, the price for natural gas in Berkshire County this winter is expected to remain the same as last winter at $1.39 per therm.

"We will be very close to the current price, barring extremely cold weather," Farrell said. "But we are confident that price will remain stable."

According to a report issued by the U.S. Energy Information Administration on Wednesday, "The average price paid by households in the Northeast this winter for heating oil may be the highest ever, almost $3.71 per gallon, more than double the average cost of natural gas."

That is an increase of more than 10 percent.

The report notes that in seven years, the cost of heating oil has more than doubled.

And given the current federal budget situation, Atwater noted, nobody knows from one month to the next what will happen with LIHEAP, which could force many Berkshire County families into a precarious set of choices -- whether to buy heat, food or health care.

"The deficit is an important issue we need to deal with," Atwater said, "but we’ve got to be careful that it is not done on the backs of the poor."

To reach Scott Stafford: sstafford@berkshireeagle.com or (413) 496-6241.

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"Obama 2013 budget would reduce heating aid: Lawmakers say plan poses threat to citizens in need"
By Danielle Ryan - news@seacoastonline.com - February 15, 2012

WASHINGTON — President Barack Obama's budget proposal for fiscal year 2013, unveiled Monday, would reduce the current level of funding for the Low Income Home Energy Assistance Program, which helps to heat the homes of thousands of low-income residents.

The proposal sets funding for LIHEAP at $3 billion for the fiscal year that begins Oct. 1. In budget documents, the Obama administration stressed it is asking for $450 million more than its request for the fiscal year 2012 to "target funds to states with vulnerable households facing high home heating costs for winter 2012-2013." However, Obama's proposed $3 billion still falls short of the nearly $3.5 billion that was eventually approved by Congress for the current fiscal year.

Legislators from cold-weather states are certain to push to increase the president's proposed LIHEAP spending when the issue is before Congress in the coming months. Rep. Frank Guinta, R-N.H., expressed concern over the president's proposal, which he said "would cause hardship for thousands of Granite Staters who rely on LIHEAP to keep their homes warm in winter."

Guinta recently joined Rep. Charles Bass, R-N.H., and other House colleagues in sending a letter to the president to ask that LIHEAP funding at least be maintained at its current level. "Sadly, that isn't reflected in his new budget proposal," Guinta said.

Bass added, "I have serious concerns that his budget request for 2013 will not be enough to help New Hampshire families struggling with high heating costs next winter."

Last month, Sens. Jeanne Shaheen, D-N.H., and Kelly Ayotte, R-N.H., joined 38 other senators in a letter to the president asking that further LIHEAP cuts be avoided.

"While I am still reviewing the full details of the president's budget request, I am concerned that the proposed LIHEAP allocation may not provide sufficient funds for New Hampshire," Ayotte said in a statement. "I will continue my work to responsibly fund LIHEAP and bring greater accountability to the program so that New Hampshire's most vulnerable citizens are not left out in the cold."

Celeste Lovett, fuel assistance program manager at the New Hampshire Office of Energy and Planning, said LIHEAP helped 45,252 families in the state last winter, as compared to 31,956 families to date this winter. New Hampshire has received $14.7 million in LIHEAP funding for the current winter, down from $34 million a year ago, she said.

According to the Campaign for Home Energy Assistance, a national group, Granite State residents who receive help from LIHEAP have incomes less than 200 percent of the federal poverty level.

Joanne Morin, director of the N.H. Office of Energy and Planning, acknowledged the president's proposed budget at least "recognized New England's vulnerability because of dependence on heating oil."

"We anticipate it will be tight this year but we're going to have to wait to see the exact effect," she said. "Although, we do believe we will serve those with incomes 200 percent below the poverty line."

Brandon Avila, a spokesman for the Campaign for Home Energy Assistance, said that while the Obama administration acknowledged energy costs are rising, his group is "still disappointed that the administration hasn't taken into consideration the growing number of households eligible for assistance." The most recent available estimate by the Campaign for Home Energy Assistance indicates 134,200 New Hampshire households were eligible for LIHEAP assistance in 2010.

Avila warned the program will need at least $4.7 billion nationally to function effectively. That is the level at which Congress funded LIHEAP in fiscal year 2011 — about $1.2 billion more than the nearly $3.5 billion being provided nationwide this year, and $1.7 billion above what was proposed by Obama on Monday.

"Anything lower and there's a real concern that a lot of families could be turned away," Avila said of the $4.7 billion.

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"Obama begins political counteroffensive this week"
By Steven R. Hurst, Associated Press, August 14, 2011

WASHINGTON—President Barack Obama launches a political counteroffensive this week, weighed down by a stunted economy, wilting support among some of his most ardent backers, and a daily bashing from the slew of Republicans campaigning for his job.

"We've still got a long way to go to get to where we need to be. We didn't get into this mess overnight, and it's going to take time to get out of it," the president told the country over the weekend, all but pleading for people to stick with him.

A deeply unsettled political landscape, with voters in a fiercely anti-incumbent mood, is framing the 2012 presidential race 15 months before Americans decide whether to give Obama a second term or hand power to the Republicans. Trying to ride out what seems to be an unrelenting storm of economic anxiety, people in the United States increasingly are voicing disgust with most all of the men and women, Obama included, they sent to Washington to govern them.

With his approval numbers sliding, the Democratic president will try to ease their worries and sustain his resurrected fighting spirit when he sets off Monday on a bus tour of Minnesota, Iowa and Illinois. The trip is timed to dilute the GOP buzz emanating from the Midwest after Republicans gathered in Iowa over the weekend for a first test of the party's White House candidates. The state holds the nation's first nominating test in the long road toward choosing Obama's opponent.

"You have just sent a message that Barack Obama will be a one-term president," Minnesota Rep. Michele Bachmann told elated supporters minutes after winning Saturday's Iowa straw poll, essentially a fundraising event that also tests a candidate's organizational and financial strength. She spent heavily and traveled throughout the state where she was born, casting herself as the evangelical Christian voice of the deeply conservative small-government, low-tax tea party wing of the GOP.

Bachmann pulled in 4,823 votes, or 29 percent of those cast, edging out Texas Rep. Ron Paul, who drew 4,671 votes, or 28 percent. But while Democrats probably rejoiced that Bachmann's ultraconservative voice gained strength among Republican contenders, the contest to challenge Obama in November 2012 grew even more jumbled. While the voting was under way in Ames, Iowa, Republicans also had to keep an eye on South Carolina, where Texas Gov. Rick Perry made a cleverly timed entrance into the race.

Like Bachmann and all the other candidates, Perry ravaged Obama. He said the president was presiding over an "economic disaster," in a declaration that stole some of Bachmann's political thunder and undercut the front-runner status of former Massachusetts Gov. Mitt Romney, who didn't compete in the Iowa test vote. Perry clearly cast a broad shadow across the Republican contest.

Obama, expecting the political shelling he would take, fired pre-emptively in his weekly radio and Internet address to the nation on Saturday. He told listeners that it was the Republicans running for president and serving in Congress who were at work crushing voters' hopes and dreams.

The question for Obama and his backers remains: Will he sustain the counterattack? Of late, he's been seen by even his most staunch supporters as too ready to retreat from critical ground when confronted by intransigent Republicans.

Polls show voters hold both parties to blame for the stunted economic recovery, an unseemly political fight over raising the limit on U.S. borrowing, an anemic deal to cut the government deficit, the subsequent and unprecedented downgrade of the country's credit rating, wild stock market gyrations and an unemployment rate stuck above 9 percent.

In the face of that reality, Obama is tacking to put some wind in his re-election sails, apparently convinced that he can gather speed by turning up the attack on Congress.

"You've got a right to be frustrated," the president said in his weekly address. "I am. Because you deserve better. I don't think it's too much for you to expect that the people you send to this town start delivering."

He chastised Republicans for brinksmanship, saying "some in Congress would rather see their opponents lose than see America win."

That's an assessment that has some validity, particularly among the new class of House Republicans who have used their outsized legislative power to stymie Obama at every turn since their election last November.

Working in Obama's favor is a Republican Party still struggling to find a presidential candidate who lights a fire with voters. Questions remain about the appeal of Bachmann and Paul beyond, respectively, the more conservative and libertarian wings of the party.

Former Minnesota Gov. Tim Pawlenty, looking for a strong showing in Iowa to boost his struggling candidacy, ended a distant third with 2,293 votes, or 14 percent. On Sunday, he quit the race.

Former Alaska Gov. Sarah Palin, the GOP's 2008 vice presidential nominee, wasn't on the ballot and isn't a candidate yet. But she showed up at the Iowa State Fair a day before the vote, drawing huge crowds and saying she hadn't ruled out running.

Like Bachmann and Perry, Palin is a tea party favorite, but her coyness about joining the race could hurt her chances should she finally declare.

While Obama's bus tour is meant, in part, to blunt the Iowa Republican festivities, it will have to compete for attention as the country digests Perry's rhetorical assault on Obama's presidency.

Perry, a former Democrat and the nation's longest-serving governor, told his appreciative audience that Obama's government had "an insatiable desire to spend our children's inheritance." He accused Obama of presiding over an "economic disaster" that has been "downgrading our hope for a better future."

"I'll work every day to try to make Washington, D.C., as inconsequential in your lives as I can," Perry said, clearly bowing to his tea party backing. Specifics for turning his promises into realities were absent.

By entering the race on the same day as the Iowa voting, Perry angered some Republicans but saved some campaign cash and energy.

If nothing else, voters won't be able to ignore the fact that Perry's speaking style and swagger are eerily reminiscent of another Texas governor who made the transition to the national stage: President George W. Bush.

With his solid credentials on social as well as economic issues, Perry is an immediate threat to Bachmann, Romney and every other GOP candidate.

Romney did not participate in the Iowa poll, which he won four years ago before dropping out of the race when he failed to catch fire against eventual nominee John McCain. Romney did join all the announced candidates Thursday at an Iowa debate.

But it was his pre-debate visit to the Iowa State Fair that produced a political gift to the Democrats.

Responding to a heckler who challenged him on tax policies that benefit big business, he blurted out that "corporations are people, my friend." The Democratic National Committee quickly used video of that remark in pre-straw poll television ads in Des Moines, the state capital. It was the kind of business-friendly Republican applause line that could haunt him with undecided voters and disaffected Democrats.

Obama and the other GOP hopefuls now face daily scrutiny as well as they try to avoid for the same kind of misstep. That's a nearly impossible task in the long, arduous and expensive path toward the White House.

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"Obama departs Washington, heads to Martha’s Vineyard for family vacation"
By Associated Press, August 18, 2011

WEST TISBURY, Massachusetts — President Barack Obama ditched the Beltway grind Thursday to seek the pleasures of summer on the beaches of Martha’s Vineyard, his leisure time competing with a stock market plunge, fears of global recession and restless voters demanding jobs.

The president arrived on this wealthy Massachusetts island retreat Thursday afternoon, where he was joining first lady Michelle Obama and their daughters, Sasha and Malia. They are to spend 10 days in a rented compound.

The departure came after a busy morning in which the president called for Syrian President Bashar Assad to step down and imposed sanctions on the beleaguered Mideast regime. He then met with members of his economic team, which is preparing a jobs package that the president intends to announce shortly after Labor Day.

Obama departed Thursday afternoon wearing business attire — gray suit and tie — that belied his resort destination. Obama was traveling with a handful of aides, including his counterterrorism chief, John Brennan. Though his family was awaiting him on Martha’s Vineyard, the family dog, Bo, traveled with the president on Air Force One.

Republicans complained that the president should stay in Washington to work on the faltering economy.

Criticism of presidential vacations seems unavoidable, but this time Obama leaves with the economy in a particularly precarious state. Morgan Stanley economists warned Thursday that the U.S. and European economies are “dangerously close” to a recession, and Gallup this week put Obama at the lowest approval rating of his presidency in terms of handling the economy — a measly 26 percent.

White House spokesman Josh Earnest said the president would continue meeting with economic advisers throughout his vacation as he prepares for his September jobs speech.

“The president of the United States is the president of the United States wherever he goes,” Earnest said. “I don’t think the American people begrudge the president spending a little time with his wife and daughters at the end of the summer before his daughters head back to school.”

Obama’s vacation will also keep him absent just as the GOP presidential field, led by Rep. Michele Bachmann of Minnesota, Texas Gov. Rick Perry, and former Massachusetts Gov. Mitt Romney, mounts an ever louder attack on his policies. Romney is among those who’ve called on Obama to cancel his vacation and stay in Washington.

The foundering economy and 2012 presidential politics will await Obama when he returns to Washington at the end of next week prepared to give a major economic speech after Labor Day to lay out new jobs initiatives and call for action from Congress, which is also on its annual summer recess.

Until then, Obama, who just returned from a three-day Midwest bus trip focused on the economy, may be hoping for a relatively uneventful break.

As they did last year, the Obamas will stay at the Blue Heron Farm, a multimillion-dollar hideaway with its own gym, basketball court, guesthouse and stretch of beach. Obama last year spent his days on the golf course with a few buddies, venturing out on occasion for a beach picnic with the family, to local restaurants with Michelle and to take Sasha and Malia to a bookstore to pick up some summer reading.

Accustomed to vacationing presidents — it will be Obama’s third straight year on the island and Bill Clinton spent time there, too — the locals were welcoming and unobtrusive — no doubt a welcome change from Obama’s foes on Capitol Hill and on the campaign trail.

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"Another year of economic shortfalls predicted"
The Congressional Budget Office says the federal deficit is projected to hit $1.3 trillion in fiscal 2011, the third year of shortfalls at levels not seen since World War II.
By Lisa Mascaro (lisa.mascaro@latimes.com), Los Angeles Times - Washington Bureau (Reporting from Washington), August 25, 2011

A third consecutive year of massive federal deficits and a slumping economy with high unemployment portrays a bleak fiscal outlook for the U.S., promising a divisive political debate this fall over how to get the country back on track.

The Congressional Budget Office said Wednesday (8/24/2011) the federal deficit was projected to hit $1.3 trillion in fiscal 2011, the third year of shortfalls at levels not seen since World War II.

As the economy continues to struggle, unemployment is expected to remain stubbornly high through the end of the year, but dip to 8.5% as the 2012 election approaches, a slight improvement but still high and on par with previous projections by the congressional agency. Polls show jobs remain a top priority for Americans.

Both Democrats and Republicans seized on the report as Congress and President Obama prepare to battle anew over the best approach to improve the economic outlook while reducing the nation's debt.

GOP leaders said the report offered more evidence that the Obama administration's fiscal policies had been a failure. "Where are the jobs?" asked House Speaker John A. Boehner (R-Ohio).

Democrats said it showed the troubled economy could no longer afford tax breaks for the wealthy that expire next year. "The most effective way to reduce our deficit is to put Americans back to work and grow our economy," said Rep. Nancy Pelosi (D-San Francisco), the House minority leader.

Obama is expected to ask Congress for new measures to create jobs — possibly by extending payroll tax breaks, offering companies tax credits for adding employees, and by investing in roads, bridges and school construction projects.

Those options will cost money, and Obama has called for an approach that simultaneously tackles deficits by cutting federal spending elsewhere and increasing tax revenue.

Economists generally support that two-step remedy as appropriate for the times: fiscal stimulus in the short term to keep the economy from slipping further, alongside a long-term plan to reform tax and spending policies to reduce the debt load.

Republicans, though, are in no mood for compromise. Fresh from holding the line on new taxes during the debt ceiling debate, the GOP is pursuing a vision of government that relies on larger tax breaks, spending cuts and regulatory relief to fuel economic growth.

One point is clear: To continue business as usual in Washington would lead to a "bleak" economic outcome, said Douglas W. Elmendorf, director of the Congressional Budget Office.

The dour outlook gives more urgency to the congressional "super committee" on deficit reduction — the new panel that skeptics say will be unlikely to reach a bipartisan agreement in its remaining 10 weeks of work. It has not yet held its first meeting, but on Wednesday its co-chairs, Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Texas), said they were working to ensure the committee "is given every opportunity to succeed."

The committee is tasked with cutting $1.5 trillion from deficits over the next decade through spending cuts, new taxes or a combination of both. If it cannot agree on a proposal for Congress to consider, as many think is likely, automatic spending cuts of a similar size would be triggered, though they would not take effect until 2013. A committee website to take public input could be launched in days.

But the debate over whether to increase taxes has vexed Washington. The tax breaks enacted under the George W. Bush administration expire at the end of 2012, and keeping all of them in place would add about $4 trillion to the deficit over 10 years.

Deficits would plummet in 2013 if all of the Bush-era tax cuts expired, but that is unlikely, as most of the tax breaks go to middle-class families and have bipartisan support. The upper-income tax cuts, though, remain a political dispute.

"There's absolutely no doubt there are profound budget challenges and profound economic challenges," Elmendorf said Wednesday.

The budget office said the record deficits over the last three years stemmed from the "long shadow" cast on the economy from the financial crisis and recession.

Deficits ballooned as the federal government spent money to shore up the economy with the stimulus program, industry bailouts and aid for unemployed Americans. Deficits also rose as tax revenue dropped substantially. The Congressional Budget Office's estimated deficit for 2011 is actually a slight dip from earlier projections.

Part of the problem that lawmakers face in tackling budgetary issues is that their options become increasingly limited as the economy struggles and the fiscal problems deepen, experts say.

For example, the budget accord reached this summer to raise the debt ceiling will help to substantially reduce the nation's future debt load by reducing spending, the report said.

But slashing federal outlays also causes short-term pain as the economy struggles to grow. Federal budget cuts are "weighing on output and employment," Elmendorf said.

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Labor economist Alan Krueger was nominated by President Obama to head the White House Council of Economic Advisers. (Larry Downing/Reuters)

"Labor specialist picked to head economic panel"
By Jackie Calmes, New York Times, August 30, 2011

WASHINGTON - In tapping Alan B. Krueger yesterday to chair the Council of Economic Advisers, President Obama picked an economist well known for his studies of labor markets, just as the president is about to announce a renewed push for job-creation policies.

Among the stimulus policies Obama is considering is a temporary tax credit for employers adding to their workforce, an idea Krueger championed in his earlier stint in the administration. Krueger was an assistant secretary and chief economist at the Treasury Department for 17 months, before he returned to his teaching post at Princeton University in 2010. A more modest version of the hiring credit became law, but congressional Republicans blocked its extension last year.

Krueger, if confirmed by the Senate, will find Republicans a force to be reckoned with against the sorts of ideas he is associated with, including a higher minimum wage. Republicans have taken control of the House since he left Washington, and party leaders say they will oppose further stimulus measures.

Their focus is spending cuts, despite widespread calls from economists, including the chairman of Federal Reserve, Ben S. Bernanke, for a more expansive fiscal policy in a period of weak economic growth and stubbornly high unemployment.

Obama, in a speech next week, is expected to call for both temporary tax cuts and spending measures to spur hiring in the short term, and long-term steps to reduce spending and raise revenues once the economy fully recovers. But in nominating Krueger, with his expertise in policies that affect job creation, Obama passed over economists better known for deficit-reduction policies, including Alan J. Auerbach of the University of California Berkeley.

The choice of Krueger more broadly reflects Obama’s desire to strike a balance between job creation and deficit reduction after months in which congressional Republicans successfully forced action only on spending cuts. Krueger, who first joined the administration during the recession, helped design other early stimulus proposals, including the cash for clunkers rebates for new car purchasers, the Build America Bonds program to finance infrastructure projects, and a credit fund for small businesses.

“As one of this country’s leading economists, Alan has been a key voice on a vast array of economic issues for more than two decades,’’ Obama said. “Alan understands the difficult challenges our country faces.’’

The ability to win confirmation was a certain consideration; Krueger was successfully confirmed for his prior post with the Treasury. But the chairmanship of the Council of Economic Advisers is a higher position, and Republicans have become more aggressive about blocking nominees to demonstrate opposition to White House policies. Obama’s pick for Commerce secretary, John E. Bryson, remains in limbo three months after his nomination.

Krueger, 50, would replace longtime Obama adviser Austan Goolsbee, who returned to the University of Chicago. Krueger “is going to be able to hit the ground running immediately,’’ Goolsbee said. “And B, he’s a world-class, respected researcher on job-market policies, job creation, and things of that nature.’’

Krueger would be the second former adviser to the Treasury secretary, Timothy F. Geithner, to take one of the four positions at the core of Obama’s economic circle; the other is Gene B. Sperling, a former Treasury counselor who replaced Lawrence H. Summers as director of the National Economic Council at the White House. That Geithner has two former underlings on Obama’s economic team is further evidence of his influence.

It also reflects Obama’s wish for a collegial economic team after the fractiousness in his first two years, which were marked by tension especially between Summers and the former White House budget director, Peter R. Orszag. Back then, Summers questioned the likely effectiveness and cost of the job credit proposal associated with Krueger, officials say.

Orszag was a student of Krueger’s at Princeton, where Krueger began teaching in 1987. “He was one of my best professors,’’ Orszag wrote in an e-mail.

Conservative economists also applauded the choice, including the top economic advisers under Ronald Reagan and George W. Bush - Martin Feldstein and Gregory Mankiw, respectively.

The cooler reception came from some on the left, who said the moment called for a big-picture macroeconomist who would push for more ambitious initiatives to reduce unemployment.

“The kind of action he’s an aggressive and creative thinker about is relatively small-bore, supply-side changes rather than big-picture efforts to fill the gap,’’ Matthew Yglesias, a senior fellow at the liberal Center for American Progress, wrote in a blog.

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"White House creates website for online petitions"
By Darlene Superville, Associated Press, September 1, 2011

WASHINGTON — The White House is making it easier for people to press the federal government to act.

It is bringing that constitutional right to petition one's government into the digital age with a webpage, "We the People," where people can create and sign petitions seeking the government's action on a range of issues.

An official response is guaranteed for any petition that draws enough signatures -- 5,000 names within 30 days -- after it is reviewed by staff and the appropriate policy experts within the Obama administration.

The White House announced the new page, www.whitehouse.gov/wethepeople, on Thursday.

"When I ran for this office, I pledged to make government more open and accountable to its citizens," President Barack Obama said in the announcement. He said the new feature will give Americans "a direct line" to the White House on issues that most concern them.

The online petition program comes as Obama has been urging the public to press their representatives in Congress to act on his ideas for creating jobs and balancing the federal budget.

To emphasize word-of-mouth organizing, a petition's Web address initially will only be known by the person who created it. The address is not supposed to show up anywhere else on the White House website until 150 signatures have been collected.

The first online petitions can be created later this month.

The White House already accepts petitions through its correspondence office and that is not expected to change, officials said.

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September 2, 2011

Breaking News from ABCNEWS.com:

Employers Added No New Jobs in August, Unemployment Rate Unchanged at 9.1 Percent, Labor Dept. Reports.

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"Obama yields on smog rule in face of GOP demands"
Obama scraps stricter smog regulation, bowing to business, GOP but angering liberal backers
Julie Pace and Dina Cappiello, Associated Press, September 2, 2011

WASHINGTON (AP) -- In a dramatic reversal, President Barack Obama on Friday scrubbed a clean-air regulation that aimed to reduce health-threatening smog, yielding to bitterly protesting businesses and congressional Republicans who complained the rule would kill jobs in America's ailing economy.

Withdrawal of the proposed regulation marked the latest in a string of retreats by the president in the face of GOP opposition, and it drew quick criticism from liberals. Environmentalists, a key Obama constituency, accused him of caving to corporate polluters, and the American Lung Association threatened to restart the legal action it had begun against rules proposed by President George W. Bush.

The White House has been under heavy pressure from GOP lawmakers and major industries, which have slammed the stricter standard as an unnecessary jobs killer. The Environmental Protection Agency, whose scientific advisers favored the tighter limits, had predicted the proposed change would cost up to $90 billion a year, making it one of the most expensive environmental regulations ever imposed in the U.S.

However, the Clean Air Act bars the EPA from considering the costs of complying when setting public health standards.

Obama said his decision was made in part to reduce regulatory burdens and uncertainty at a time of rampant questions about the strength of the U.S. economy.

Underscoring the economic concerns: a new report Friday that showed the economy essentially adding no jobs in August and the unemployment rate stubbornly stuck at 9.1 percent.

The regulation would have reduced concentrations of ground-level ozone, the main ingredient in smog, a powerful lung irritant that can cause asthma and other lung ailments. Smog is created when emissions from cars, power and chemical plants, refineries and other factories mix in sunlight and heat.

Republican lawmakers, already emboldened by Obama's concessions on extending Bush-era tax cuts and his agreement to more than $1 trillion in spending reductions as the price for raising the nation's debt ceiling, had pledged to try to block the stricter smog standards as well as other EPA regulations when they returned to Washington after Labor Day.

A spokesman for House Speaker John Boehner, R-Ohio, had muted praise for the White House Friday, saying that withdrawal of the smog regulation was a good first step toward removing obstacles that are blocking business growth.

"But it is only the tip of the iceberg when it comes to stopping Washington Democrats' agenda of tax hikes, more government `stimulus' spending and increased regulations, which are all making it harder to create more American jobs," said Boehner spokesman Michael Steel.

Thomas Donohue, president of the U.S. Chamber of Commerce, said the move was "an enormous victory for America's job creators, the right decision by the president and one that will help reduce the uncertainty facing businesses."

White House officials said the president's decision was not the product of industry pressure, and they said the administration would continue to fight other efforts by Republicans to dismantle the EPA's authority.

But that was little consolation for many of the president's supporters. The group MoveOn.org issued a scathing statement, saying Obama's decision was one it would have expected from his Republican predecessor.

"Many MoveOn members are wondering today how they can ever work for President Obama's re-election, or make the case for him to their neighbors, when he does something like this, after extending the Bush tax cuts for the rich and giving in to tea party demands on the debt deal," said Justin Ruben, the group's executive director.

The American Lung Association, which had sued the EPA over Bush's smog standards, said it would resume its legal fight now that Obama was essentially endorsing the weaker limit. The group had suspended its lawsuit after the Obama administration pledged to change it.

Obama's decision, in fact, mirrors one made by Bush in 2008. After EPA scientists recommended a stricter standard to better protect public health, Bush personally intervened after hearing complaints from electric utilities and other affected industries. His EPA set a standard of 75 parts per billion, stricter than one adopted in 1997, but not as strong as federal scientists said was needed to protect public health.

In March, the EPA's independent panel of scientific advisers sent a letter to the agency's administrator, Lisa Jackson, saying it was its unanimous recommendation to make the smog standards stronger and that the evidence was "sufficiently certain" that the range proposed in January 2010 under Obama would benefit public health.

But the White House, which has pledged to base decisions on science, said Friday the science behind its initial decision needed to be updated, a process already under way at EPA. The smog standard now is to be revised until 2013.

Whether Obama still occupies the White House at that point depends on the outcome of next year's presidential election.

Cass Sunstein, the head of the White House regulatory office, said changing the smog regulation now, only to have it be reconsidered again in two years, would create unnecessary uncertainty for the private sector and local governments.

The stricter limits initially proposed by Obama would have doubled the number of counties in violation. Smoggy cities such as Los Angeles and Houston would have been joined by counties in California's Napa Valley and one in Kansas with a population of 3,000. They would have had up to 20 years to meet the new limits, once EPA settled on a final number, or would have faced federal penalties.

In his statement, the president said scrapping the stronger smog standards did not reflect a weakening of his commitment to protecting public health and the environment.

"I will continue to stand with the hardworking men and women at the EPA as they strive every day to hold polluters accountable and protect our families from harmful pollution," Obama said.

Even before Friday's decision -- announced as many Americans were paying more attention to their Labor Day weekend plans than the news -- the White House has faced some criticism for its record on the environment. Obama abandoned a campaign pledge to set the first-ever limits on the pollution blamed for global warming, and he announced an expansion of offshore drilling before the Gulf oil spill sidelined those plans.

However, he has successfully taken other steps to reduce air pollution, such as doubling fuel efficiency standards for cars and light trucks, clamping down on pollution from power plants that blows downwind and setting the first national standard for mercury, a toxic metal, from power plants, all in the face of Republican and industry opposition.

The ground-level ozone standard is closely associated with public health -- something the president said he wouldn't compromise in his regulatory review.

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"Congress returns, unpopular as well as divided"
By DAVID ESPO - AP Special Correspondent | AP – September 3, 2011

WASHINGTON (AP) — Congress returns to work this coming week, divided over measures to create jobs and scorned by the nation it was elected to help lead.

After a five-week break, Republican and Democratic leaders alike promise action to try and ease the country's 9.1 percent unemployment rate and boost an economy that is barely growing. President Barack Obama goes first on Thursday night with a speech to lawmakers and a prime-time national television audience.

But there is little overlap so far in the measures that Republicans and Democrats are recommending, and the rest of the year-end congressional agenda is top-heavy with items that relate to government spending and less directly to job creation.

A new committee, comprised of lawmakers in both parties from both houses and armed with extraordinary powers, is expected to hold its first meeting this week as it begins work on a plan to make long-term deficit cuts. The panel was created as part of last month's agreement to reduce red ink and avert a government default. It faces a Nov. 23 deadline for action.

More immediately, parts of the Federal Aviation Administration will shut down on Sept. 16 unless Congress approves a measure to keep operations running. Federal money for highway construction jobs runs out two weeks later without separate legislation.

The Obama administration is seeking more money for disaster relief in the wake of Hurricane Irene, and a partial government shutdown would occur on Oct. 1 unless lawmakers enact an interim spending bill to cover most federal agencies.

With any or all of these measures, there is an opportunity for partisan gridlock or compromise, and it isn't entirely clear which an unhappy public might prefer.

In a late-August Associated Press-GfK poll, only 12 percent of those surveyed said they approved of the job Congress is doing, and 87 percent disapproved. A separate Gallup survey, taken in midmonth, found 13 percent approved and 84 percent disapproved.

"Everybody is kind of in trouble with the electorate," said Republican pollster Bill McInturff. He recently distributed an analysis that concluded the negotiating surrounding last month's agreement to avoid a default is an extremely significant event that is profoundly and sharply reshaping views of the economy and the federal government.

"It has led to a scary erosion in confidence in both, at a time when this steep drop in confidence can be least afforded."

But if the public was offended by the bickering before the deal, there isn't there much evidence that the compromise on the nation's borrowing limit did much, if anything, to restore confidence in Congress' ability to address economic problems.

A Fox News poll last month showed opinion was split on the compromise, with Republicans overwhelmingly opposed, independents solidly so and Democrats narrowly in favor. But even those statistics masked a deeper divide.

Based on other surveys, McInturff said, "Republicans disapprove because some didn't think we should have raised the debt ceiling at all ... and others because they believe there should have been substantially more spending cuts than what was in the debt-ceiling vote."

Independents who disliked the compromise tended to say they wanted deeper deficit reductions. Democrats who disapprove did so because "they can't believe the president is negotiating doing this much with the Republicans," he said, which is a far different reason from the one GOP voters cite.

The Fox News survey showed a similar breakdown.

Republicans and Democrats offer different assessments of the state of congressional approval.

"I'm not the least bit surprised that the rating of Congress is abysmal. If we could do the work that we are supposed to be doing in a reasonable and timely way," it would improve, said Sen. Pat Toomey, R-Pa., a first-termer who is a member of the committee charged with finding $1.2 billion or more in deficit reductions.

Senate Majority Leader Harry Reid, D-Nev., had a somewhat different view, telling an audience in his home state: "Everyone complain all you want about Congress. You should complain plenty. But don't think the country is about to fall apart because of what's going on in Washington."

Already, the differences are evident as Obama and congressional leaders ready job creation plans.

House Majority Leader Eric Cantor, R-Va., recently distributed a list of "Top 10 Job-Destroying Regulations" and said the Republican majority would begin voting this month to block them one by one.

Most, including one that Obama ordered scrapped Friday, deal with pollution limits for a variety of industries; two would curtail National Labor Relations Board actions opposed by business.

Separately, Cantor wrote, the House will "pursue tax relief designed to help American employers create middle-class jobs."

Obama, too, is considering tax breaks to provide businesses to hire new employees. He also is expected to call for new spending on construction projects, and to seek an extension of jobless benefits and a temporary payroll tax cut that is due to expire Dec. 31.

To offset those costs, the president is expected to challenge lawmakers on the debt-reduction committee to go beyond its minimum goal of $1.2 trillion in long-term savings.

The panel marks the latest and possibly the last attempt of the year to forge a sweeping agreement that can cut trillions from future deficits. Congress must approve $1.2 trillion in deficit cuts to block across-the-board spending cuts that both sides say they would like to avoid.

There are expressions of optimism, but so far, none of outright success.

Reid put the prospects of a compromise at 50-50.

Toomey said he was "cautiously optimistic."

"We know how difficult this task is going to be, and I am heartened by the strong encouragement I have gotten from my constituents and my colleagues on both sides of the aisle," Rep. Fred Upton, R-Mich., said Friday in a written statement. "We'll begin by identifying those areas where we have common ground, and we are ready to roll up our sleeves and get to work."

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"Labor unions adjust to new reality under Obama"
By SAM HANANEL - Associated Press | AP – September 4, 2011

WASHINGTON (AP) — In the early days of the Obama administration, organized labor had grand visions of pushing through a sweeping agenda that would help boost sagging membership and help revive union strength.

Now labor faces this reality: Public employee unions are in a drawn-out fight for their very survival in Wisconsin, Ohio and other states where GOP lawmakers have curbed collective bargaining rights.

Also, many union leaders are grousing that the president they worked so hard to elect has not focused enough on job creation and other bold plans to get their members back to work.

"Obama campaigned big, but he's governing small," said Larry Hanley, president of the Amalgamated Transit Union.

Labor remains a core Democratic constituency and union leaders will stand with Obama in Detroit this Labor Day, where he will address thousands of rank-and-file members during the city's annual parade Monday.

But at the same time, unions have begun shifting money and resources out of Democratic congressional campaigns and back to the states in a furious effort to reverse or limit GOP measures that could wipe out union rolls.

The AFL-CIO's president, Richard Trumka, says it's part of a new strategy for labor to build an independent voice separate from the Democratic Party.

Union donations to federal candidates at the beginning of this year were down about 40 percent compared with the same period in 2009, according to the Center for Responsive Politics. Last month, a dozen trade unions said they would boycott next year's Democratic National Convention in Charlotte, N.C., over frustration on the economy and to protest the event's location in a right-to-work state.

"The pendulum has swung a long way," said Ross Eisenbrey, a vice president of the liberal Economic Policy Institute. "In the next year, I think all unions can really hope for is to keep more bad things from happening and to get as much of a jobs program enacted as possible."

Unions fell short last month in their recall campaign to wrest control of the Wisconsin Senate from Republicans. That fight was a consequence of Gov. Scott Walker's proposal to eliminate collective bargaining rights for public-employee unions as a part of a cost-cutting effort. Now they are spending millions more in Ohio, where they hope to pass a statewide referendum in November that would repeal a similar measure limiting union rights.

It's a far cry from the early optimism unions had after Obama came into office. Back then, unions hoped a Democratic-controlled Congress would pass legislation to make it easier for unions to organize workers. But business groups fought that proposal hard, and it never came to a vote.

Union leaders grew more disappointed when the president's health care overhaul didn't include a government-run insurance option. Then Obama agreed to extend President George W. Bush's tax cuts for the wealthy.

Obama came out in favor of trade agreements with South Korea, Colombia and Panama that most unions say will cost American jobs. Despite campaigning in favor of raising the minimum wage from $7.25 to $9.50 an hour, Obama hasn't touched the issue since taking office.

It didn't help that Obama declined union invitations to go to Wisconsin, where thousands of protesters mobilized against the anti-union measure. Candidate Obama had promised to "put on sneakers" and walk a picket line himself when union rights were threatened.

Obama has handed labor smaller victories that didn't have to go through Congress, like granting the nation's 44,000 airport screeners limited collective bargaining rights for the first time. The National Labor Relations Board and other agencies filled with Obama's appointees have made it easier for unions to organize workers in the airline, railroad and health care industries.

The NLRB has taken a beating from Republicans after filing a lawsuit that accuses Boeing of opening a new plant in South Carolina in retaliation against union workers in Washington state.

"The field has tilted against labor so that whatever small victories they get are just tinkering around the edges and get tremendous pushback by conservatives," said Nelson Lichtenstein, director of the Center for the Study of Work, Labor and Democracy at the University of California, Santa Barbara.

But labor's frustration with Obama reached new heights this summer as Trumka accused him of working with tea party Republicans on deficit reduction instead of "stepping up to the plate" on jobs.

Labor unions and other liberal groups want Obama to push a major stimulus bill with hundreds of billions of dollars in new spending on infrastructure projects like roads, bridges and transit systems. Even if it's rejected in the GOP-controlled House, unions want to see Obama show more leadership and take a bold stand in favor of stimulus spending.

That's not likely to happen. Constrained by budget cuts and a tight debt ceiling, Obama is expected to propose a limited package worth far less than the $787 billion stimulus passed in 2009.

The plan will call on Congress to extend current payroll tax cuts and jobless benefits, spend money for new construction projects and offer incentives to businesses to hire more workers.

James Hoffa, general president of the International Brotherhood of Teamsters, said Obama should challenge businesses with healthy bottom lines to spend more in the U.S. by hiring new workers, building plants and expanding operations. If they don't, Hoffa said, Obama should call them out as disloyal.

"I think the president should challenge the patriotism of these American corporations that are sitting on the sidelines," Hoffa said Sunday on CNN's "State of the Union."

He added, "We've got to turn this around and say, 'Hey, we are an American company. We owe an obligation to America. Let's put America back to work.'"

Labor Secretary Hilda Solis defended Obama from liberal critics, saying the administration has established many programs to create jobs, worked to extend unemployment insurance benefits and helped save the auto industry.

"The president is very concerned about job creation," Solis told reporters at the National Press Club. "That been our priority from day one."

Union face a tougher challenge in the states.

Walker wanted to patch the state's budget shortfall by requiring state workers to pay more for their health care and pension benefits. He said curbing bargaining rights was important in the long term to prevent unions from reversing the move in future negotiations.

Republican Wisconsin state Rep. Robin Vos said the big money spent by pro-labor forces in the recall elections shows "that they're not about protecting workers rights, they're about protecting political power."

"This is the last grasp of those political bosses to be able to showcase why they need to have the political power, and they lost," he said.

Conservatives say Walker's measure has done just what it promised, closing budget shortfalls without laying off teachers and other workers.

"As the changes have had time to sink in, people appear to be accepting it, and it appears to be part of the new status quo," said James Sherk, a policy analyst at the Heritage Foundation.

A measure passed in Tennessee this year ended collective bargaining for teachers unions in the state. In Oklahoma, lawmakers repealed a law that had required large municipalities to collectively bargain with municipal employees.

"The fact that you didn't see much pushback in those states, I think, is significant," Sherk said.

Union leaders see a more sinister plan not only to cut union benefits, but to crush unions altogether, along with their political largesse to Democrats. The Wisconsin law, for example, bans automatic withdrawal of union dues and requires public unions to hold annual votes to avoid decertification.

In Ohio, unions are more hopeful that they can win a November referendum to undo the state's collective bargaining law that passed this spring. A Quinnipiac University poll in July found that 56 percent of Ohio voters say the new collective bargaining law should be repealed, compared with 32 percent who favor keeping it in place.

"A victory in Ohio would be a tremendous shot against the bow of Republicans to not mess with the unions," Lichtenstein said.

It could also help unions show they are still a political force to be reckoned with at both the state and national level.

Associated Press writers Scott Bauer in Madison, Wis., and Julie Carr Smyth in Columbus, Ohio, contributed to this report.

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"Tough economic climate as Obama seeks 2nd term"
By CHARLES BABINGTON - Associated Press | AP – September 4, 2011

WASHINGTON (AP) — President Barack Obama faces a long re-election campaign having all but given up on the economy rebounding in any meaningful way before November 2012. His own budget office predicts unemployment will stay at about 9 percent, a frightening number for any president seeking a second term.

Obama's prospects aren't entirely grim, however. The GOP, heavily influenced by the tea party, may nominate someone so deeply flawed or right-leaning that, Democrats hope, Obama can persuade Americans to give him a second chance rather than risk the alternative.

Democrats say the man who ran on hope and change in 2008 will have to claw his way toward a second term with a sharply negative campaign.

The strengths and weaknesses of his prospects seem clear.

Next year's unemployment rate is likely to be the highest in a presidential election since 1940. But the leading Republican contenders have denigrated Social Security, switched positions on critical issues and done other things that might make them ripe targets for Obama's well-funded campaign.

Democratic strategist Doug Hattaway says GOP candidates, including Texas Gov. Rick Perry and former Massachusetts Gov. Mitt Romney, may turn off independent voters with their embrace of tea party stands on taxes, spending and program cuts.

Obama "should lump them all together and make them answer for their slash-and-burn politics," said Hattaway, a former top aide to Hillary Rodham Clinton, Obama's rival for the 2008 Democratic presidential nomination.

To do so, Hattaway said, Obama must link the candidates to congressional Republicans, blamed by Democrats for the nation's stalled job growth and recent downgrade of U.S. creditworthiness.

Making the connection might not prove easy.

Obama's potential challengers have avoided getting dragged into details of the bitter Capitol Hill fights over deficit spending. At least for now, they can lob criticisms at the president while offering few specific, measurable alternatives.

"President Obama oversaw an economy that created zero jobs last month, and that is unacceptable," Romney said Friday.

But the influence of the tea party and other conservative groups may give Obama some openings, by pushing the GOP field so far to the right that the candidates risk alienating vital independent voters.

In a debate last month, the top contenders pledged to oppose a deficit-reduction plan even if it cut $10 in spending for every $1 raised by new taxes. Perry, who entered the race after that debate, also has taken a tough stand against higher taxes.

Obama's team says independents, who might pay scant attention to ideologically driven primaries, will find such positions extreme when they compare the eventual GOP nominee and the president.

Political aide David Axelrod hinted that Obama will try to sharpen his differences with Republicans who insist on spending cuts in virtually every area and who refuse to let tax cuts expire, as scheduled, for the wealthiest.

It's hard "to create an economy in which people can get decent jobs and raise a family at the same time we're cutting back on our commitment to spending on education and research and development that will create innovation and jobs," Axelrod said in an interview.

The Republicans' "essential message is, let's go back to the policies that helped get us in this mess," he said, citing Wall Street deregulation and corporate tax breaks.

If GOP lawmakers, backed by the presidential hopefuls, continue to thwart Obama's bid to mix targeted spending cuts with tax increases, Axelrod said, "we're going to take our case to the American people."

Recent polls underscore Obama's challenge. A Pew Research poll found that 39 percent of independents approve of his job performance, while 52 percent disapprove.

An AP-GfK poll showed a sharp erosion of support for Obama among white voters and women. Less than half of all women and less than half of all men approve of the job he's doing, and only 50 percent of women say he deserves re-election.

But the same polls show that far more voters blame former President George W. Bush more than Obama for the nation's economic woes. Whether that sentiment lingers for 16 more months could prove crucial.

Hattaway said Obama must start by winning back moderates and motivating "millennials," voters in their 20s and early 30s.

"The economy is not going to come roaring back before the election, so he has to give them a vision" for a future with jobs and with social justice for groups, including gays, Hattaway said.

Obama also must try to minimize the frustration among his liberal base supporters, many of whom feel he is too quick to compromise. Some complained loudly Friday when Obama yanked a proposal to tighten federal smog standards.

Questions about the environment, war and foreign affairs will figure into the 2012 race. But all parties agree jobs are the overriding issue.

Analysts differ on what level of unemployment is politically fatal.

President Ronald Reagan handily won re-election in 1984 with unemployment at 7.2 percent, which was down slightly from the rate at the start of his term. President Jimmy Carter lost when unemployment was at 7.5 percent and President George H.W. Bush lost with a similar level, but both faced other problems as well.

Hopeful Democrats say Obama can survive next year if people feel growth is coming soon. Another way to survive is uglier: admitting the economy is a mess, but pressing the case that the GOP alternative is so unacceptable that the incumbent should stay in office, even with no recovery in sight.

Obama's aides say the election will be "a choice, not a referendum." That hints at a bruising effort to divert attention from the president's record and focus on what the Obama campaign believes are the GOP nominee's chief shortcomings.

Democratic optimists feel the GOP nominating process will play into that strategy. The Democratic National Committee issues a steady stream of statements and videos with headlines such as "Romney makes move to embrace Tea Party."

Several Republican candidates, including Romney, Minnesota Rep. Michele Bachmann and Perry, are proven vote-getters at the state level. Soon they will show whether they can handle the scrutiny and grind of a presidential campaign.

Democrats say their records provide much to use against them.

Perry, for instance, has called Social Security "a Ponzi scheme," and said climate change is a "contrived phony mess."

Romney switched his position on abortion, gay rights and gun control after leaving the Massachusetts governor's office and seeking the Republican presidential nod. He also is criticized for his role in Bain Capital, a corporate takeover firm that eliminated jobs in some cases but expanded them in others.

Bachmann has spent only three terms in the House; the last member to go directly to the White House was James Garfield, elected in 1880. If Sarah Palin decides to run, she will be asked why she quit her job as Alaska's governor with more than a year left in her term.

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"Obama to exclude Social Security from deficits plan"
By Laura MacInnis | Reuters – September 15, 2011

WASHINGTON (Reuters) - President Barack Obama will not include reforms to the Social Security retirement program in his deficits proposals to Congress next week, the White House said Thursday.

Obama upset many fellow Democrats during this summer's bitter negotiations with Republicans on raising the debt ceiling when he expressed a willingness to change the way government benefits are linked to inflation.

He saw the move as a way to ensure the federal pension program remains viable in the long-term, but liberal supporters who champion entitlement programs for the elderly felt he was giving up too much ground to Republicans.

White House spokesman Amy Brundage said Obama's long-awaited deficit reduction plan, to be unveiled Monday, "will not include any changes to Social Security."

"As the president has consistently said, he does not believe that Social Security is a driver of our near and medium term deficits," she said.

With Obama's shift in stance, the six Democratic members of a congressional "super committee" charged with tackling the federal deficit would not have to make immediate concessions, giving them more negotiating room with their Republican counterparts. The super committee is trying to find more than $1.2 trillion in budget savings over 10 years by November 23.

Obama's change of heart on the inflation formula could help lower the heat from his liberal base, and could also help Democratic members of Congress who are up for re-election.

Obama also expressed a willingness in the summer debt talks with House of Representatives Speaker John Boehner, a Republican, to raise the eligibility age for Medicare health benefits to 67 from 65.

But The Wall Street Journal said Thursday the White House was now looking at cuts to providers and increased premiums for wealthier recipients of Medicare, the healthcare program for the elderly.

A senior administration official said final decisions have not been made about Obama's recommendations to the super committee.

While Obama's proposals will not be binding on the committee, they will likely feed into 2012 campaign rhetoric and give the president an opportunity to counter the Republican image of him as a tax-and-spend liberal.

Obama is expected to recommend more than $3 trillion in budget savings next week, although Republican members of the super committee have already questioned whether that is achievable.

Boehner, the top U.S. Republican, will call Thursday for the super committee to consider tax reform that would close loopholes but not raise rates, as well as changes to entitlement programs such as Medicare and Social Security.

He will also argue in a speech that Republicans and Democrats should work together to reduce business regulations and lower taxes and spending to boost job creation and economic growth, according to a summary provided by his office.

(Additional reporting by Andy Sullivan and Thomas Ferraro; Editing by Ross Colvin and Vicki Allen)

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"Obama seeks new minimum tax rate for millionaires: GOP is expected to oppose plan named for Buffett"
By Jackie Calmes, New York Times, September 18, 2011

WASHINGTON — President Obama tomorrow will call for a new minimum tax rate for individuals making more than $1 million a year to ensure that they pay at least the same percentage of their earnings as middle-income taxpayers, according to administration officials.

With a special joint congressional committee just starting work to reach a bipartisan budget deal by late November, the proposal adds a new and populist feature to Obama’s effort to raise the political pressure on Republicans to agree to higher revenues from the wealthy in return for Democrats’ support of future savings from Medicare and Medicaid.

Obama, in a bit of political salesmanship, will call his proposal the Buffett Rule, in a reference to Warren E. Buffett, the billionaire investor who has complained repeatedly that the richest Americans generally pay a smaller share of their income in federal taxes than do middle-income workers, because investment gains are taxed at a lower rate than wages.

Obama will not specify a rate or other details, and it is unclear how much revenue his plan would raise. But his idea of a millionaires’ minimum tax will be prominent in the broad plan for long-term deficit reduction that he will outline at the White House tomorrow.

Obama’s proposal is certain to draw opposition from Republicans, who have staunchly opposed raising taxes on the affluent because, they say, it would discourage investment. It could also invite scrutiny from some economists who have disputed Buffett’s assertion that the megarich pay a lower tax rate overall, because many in that group actually make more from wages than from investments.

In a speech Thursday, John A. Boehner, the House speaker and an Ohio Republican, agreed with Obama that the deficit-reduction committee “can tackle tax reform, and it should,’’ to get rid of many tax breaks and allow for lower marginal rates.

“Tax increases, however, are not a viable option for the joint committee,’’ Boehner said. Instead, he emphasized that meeting the deficit-reduction target should come largely from overhauling benefit programs such as Medicare, Medicaid, and Social Security.

The Obama proposal has little chance of becoming law unless Republican lawmakers bend. But by focusing on the wealthiest Americans, the president is sharpening the contrast between Republicans and Democrats with a theme he can carry into his bid for reelection in 2012.

It could also reassure Democrats who have feared that Obama would agree to changes in programs like Medicare without forcing Republicans to compromise on taxes.

The administration wants such a tax to replace the alternative minimum tax, which was created decades ago to make sure the richest taxpayers with plentiful deductions and credits did not avoid income taxes, but which now hits millions of Americans who are considered upper middle class. Obama has said that many average Americans could see a tax cut if the system is overhauled, since ending many tax breaks would allow for lower rates while raising more revenues from the wealthiest.

The millionaires’ tax is among several changes Obama will propose in urging Congress to overhaul the federal income tax code next year, both to raise revenues for reducing deficits and to make the tax system simpler and fairer, said the administration officials, who agreed to speak in advance of the president’s announcement on condition of anonymity.

The millionaires’ rate would affect only 0.3 percent of taxpayers, they said. That would be fewer than 450,000; 144 million returns were filed for 2010.

Obama’s proposal comes a month after Buffett began reviving his longstanding objection that he and “my megarich friends’’ pay a significantly lower percentage of their income in federal taxes - income and payroll taxes - than everyone else, thanks to the tax code’s favoritism toward the rich, and especially toward investors like him.

“My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice,’’ he wrote in an opinion article in The New York Times, a complaint he has repeated in talks and interviews since.

Obama has been citing Buffett as he promotes his $447 billion jobs plan. He proposes to offset the cost of that plan and reduce future budget deficits through higher taxes on the wealthy and on corporations after 2013, when the economy will presumably be healthier.

His proposed Buffett Rule puts a new spin on that pitch, as Obama tries to put Republicans in Congress and in the presidential race on the defensive for their rigid stand against higher taxes.

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"Obama allows states to opt out of some ‘No Child’ rules"
By Kimberly Hefling, AP Education Writer, September 23, 2011

WASHINGTON (AP) — Nearly everyone agrees the fix needs fixing. The No Child Left Behind law that was supposed to improve American education has left schools grumbling at being labeled ‘‘failures’’ state officials fuming and complaints everywhere about required testing.

But President Barack Obama’s response today— he’s allowing states to opt out — is starting a new round of heated arguments.

There are questions about whether letting states bypass unpopular proficiency standards will help the nation’s schoolchildren. And, even as states clamor to use the new waiver option, some lawmakers say Obama is inserting politics in what had been a bipartisan approach to education.

At the White House, the president said he was acting only because Congress wouldn't. He decried the state of US education and called the ‘‘No Child’’ law — a signature legacy of President George W. Bush’s presidency — an admirable but flawed effort that ended up hurting students instead of helping them.

Obama’s announcement could fundamentally affect the education of tens of millions of children. It will allow states to scrap a key requirement that all children show they are proficient in reading and math by 2014 — if those states meet conditions such as imposing their own standards to prepare students for college and careers and setting evaluation standards for teachers and principals.

Kids will still have to take yearly tests in math and reading, although the administration says the emphasis will be more on measuring growth over time.

The impact on school kids could vary greatly depending on how states choose to reward or punish individual schools. Under No Child Left Behind, children who attend schools deemed failures after a set period of time are eligible for extra tutoring and school choice. Under the president’s plan, it’s up to states granted waivers to decide if they will use those same remedies.

A majority of states are expected to apply for waivers, which would be given to those that qualify early next year.

State officials have long complained that if they had more flexibility, they could implement positive changes. Now, they will have to step up and prove it.

‘‘This is really going to change things because it really does put responsibility squarely on the states,’’ said Amy Wilkins, a vice president at Education Trust, a nonprofit that seeks to raise achievement standards in schools.

Officials from Kentucky, Idaho, Wisconsin and Colorado were among those expressing support for the president’s plan on Friday.

‘‘I look forward to the federal government narrowing its role in education and allowing Tennessee the flexibility to abide by its own rigorous standards,’’ Tennessee Gov. Bill Haslam, a Republican, said at the White House event.

But Rep. John Kline, R-Minn., who chairs the House Education Committee, wrote in an editorial Friday published in The Washington Examiner that the plan ‘‘could mean less transparency, new federal regulations and greater uncertainty for students, teachers, and state and local officials.’’

Sen. Mike Enzi, R-Wyo., the ranking member on the Senate committee that oversees education, said the president’s action ‘‘clearly politicizes education policy, which traditionally has been a bipartisan issue that attracts support from both parties.’’

The president’s plan is likely to feed the story line by Republicans that Obama is aggressively expanding the presidential footprint, particularly since some people might view it as unconstitutional to go around Congress to get around the law, said Frederick Hess director of education policy studies at the American Enterprise Institute

‘‘In pushing this way, the administration makes it likely that education is going to be much more of a partisan divide leading up to the 2012 election,’’ Hess said.

During Thursday night’s campaign debate in Orlando, Fla., the Republican presidential candidates echoed a common refrain about the federal government’s role in education. Mitt Romney said, ‘‘One, education has to be held at the local and state level, not at the federal level.’’ Said Rick Perry, ‘‘The federal government has no business telling the states how to educate our children.’’

Despite allowing states to do away with the approaching 2014 deadline, Obama insisted he was not weakening the law but rather helping states set higher standards. He said that the current law was forcing educators to teach to the test, give short shrift to subjects such as history and science and lower standards as a way of avoiding penalties and stigmas.

In delivering his remarks, the president took a shot at Congress, saying his executive action was needed only because lawmakers have not stepped in to improve the law.

‘‘Congress hasn’t been able to do it. So I will,’’ Obama said. ‘‘Our kids only get one shot at a decent education.’’

Education Secretary Arne Duncan has said the plan would not undermine efforts in Congress because the waivers could serve as a bridge until Congress acts.

The law was approved with strong bipartisan support nearly a decade ago. But its popularity sank as disputes over money divided Congress, schools complained they were being labeled ‘‘failures’’ and questions arose over the testing and teacher-quality provisions.

‘‘Higher standards are the right goal. Accountability is the right goal. Closing the achievement gap is the right goal. And we've got to stay focused on those goals,’’ Obama said. ‘‘But experience has taught us that in its implementation, No Child Left Behind had some serious flaws that are hurting our children instead of helping them.’’

Critics say the law placed too much emphasis on standardized tests, raising the stakes so high for school districts that it may have driven some school officials to cheat.

Duncan has warned that 82 percent of schools next year could fail to reach proficiency requirements and thus be labeled failures, although some experts questioned the figure.

The law has been due for a rewrite since 2007. Obama and Duncan had asked Congress to overhaul it by the start of this school year but a growing ideological divide in Congress has complicated efforts to do so.

The GOP-led House Education Committee has forwarded three bills that would revamp aspects of the law but has yet to fully tackle some of the more contentious issues such as teacher effectiveness and accountability.

Associated Press writers Ben Feller and Julie Pace contributed to this story.

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"Congress dodges one crisis, now on to the next"
By DONNA CASSATA - Associated Press | AP – September 27, 2011

WASHINGTON (AP) — One crisis averted, on to the next. The day after Congress managed to avoid a government shutdown — again — Republicans and Democrats stared ahead Tuesday at major fights over spending that underscore a deep divide that's sure to define the fast-approaching national elections.

Monday night, lawmakers had postponed their dispute over whether billions for disaster aid must be paid for with cuts elsewhere in the budget, finessing a pact to keep the government operating.

But tea party-driven Republicans are still insisting on significant spending cuts this fall, with some arguing that a hard-fought congressional agreement this summer to fund the government at $1.043 trillion in 2012 was too generous. Democrats, many of whom complained of too many concessions and reductions in this year's showdowns, are furiously trying to protect government programs.

The next skirmish will be over how and where to spend the new year's budget, with a Nov. 18 deadline for that legislation. President Barack Obama's $447 billion jobs proposal that would cut payroll taxes and increase spending on school construction and other infrastructure has already divided the parties. But the next really big deal is the special 12-member bipartisan supercommittee and whether it can come up with a plan to slash $1.5 trillion over 10 years by Nov. 23 — the day before Thanksgiving.

These fights will unfold against the backdrop of a feeble economy that Obama is desperate to jump-start as he pushes for a second term, and an exasperated electorate that looks at Washington and dislikes what it sees.

"The heat will be on, the heat from the American people," said former Republican Sen. Alan Simpson, who believes Americans struggling economically will be asking, "Why stretch us out like this?"

Lawmakers also will be under pressure from political factions demanding that they stand firm for party beliefs.

"You have to support getting control of excessive spending and debt," said Sal Russo, a longtime Republican operative and founder of the Tea Party Express, a well-funded wing of the populist movement. "Are you helping to solve the problem or making it worse?"

Shortly after Senate votes on Monday, Sen. Mary Landrieu, D-La., thanked party leaders "for helping the Democratic Party find the backbone it needed to fight and win this debate."

The disaster aid dispute that threatened to partially shut down the government this weekend was resolved relatively quickly after a standoff between Democrats and Republicans. The fight, however, was an unpleasant reminder to most Americans of the last-minute maneuvering in April to avert a shutdown and the August showdown over raising the nation's borrowing authority that left financial markets unnerved.

This time, Democrats had spent weeks demanding additional disaster aid in response to hurricanes, tornadoes and other natural disasters that had battered Americans from Vermont to Missouri. Republicans had said the additional aid had to be offset by cuts in energy-related programs that Democrats favored. The Federal Emergency Management Agency had warned that its accounts would be out of money early this week.

A solution to keep the government operating seemed uncertain last week. Then word from the Obama administration that FEMA wasn't in as dire financial straits as many feared proved to be the answer.

On Saturday, the administration told Senate Majority Leader Harry Reid, D-Nev., and Sen. Chuck Schumer, D-N.Y., that FEMA could last until Thursday with the money it had. Specifically, an unknown contractor had come in under budget, freeing some $40 million, said Democratic and Republican congressional aides.

On Sunday morning, Reid reached out to House Speaker John Boehner's staff, informed them of the more promising financial outlook for FEMA and proposed two bare-bones emergency spending bills, one to keep the government operating for a week and another until Nov. 18. Boehner's office contacted Senate Minority Leader Mitch McConnell with the latest developments and proposal.

McConnell's office made a quick check with the Senate Republican vote counter, Jon Kyl of Arizona, on whether such a plan would fly with the GOP.

FEMA was still saying Thursday, possibly Friday, before the money ran out, but a way out had emerged. Within hours on Monday, Democrats and Republicans had agreed on an emergency spending bill to avoid a government shutdown. FEMA would get $2.65 billion in disaster relief assistance in a one-week bill, $1 billion less than approved by tea party Republicans.

Chris Krueger, a political analyst for the brokerage firm MF Global, said, "Both sides are convinced this continued threat of government shutdown benefits no incumbents."

The House, on recess this week, probably will back the one-week measure by voice vote Thursday and vote separately next week to keep the government running through Nov. 18.

"The perils of Pauline," said John Feehery, a Republican political consultant and former congressional aide. "Every new episode has a new cliffhanger."

In a letter dated Sept. 26, Jacob Lew, director of the Office of Management and Budget, wrote congressional leaders that as FEMA approached the last five days of the fiscal year this week, "it appears that weather systems forming off our shores will not significantly affect the United States. That, in combination with FEMA's rigorous cash management mechanism, means" the agency could operate for much of the week.

Congress may have a harder time weathering the storms of budget showdowns, a reality that lawmakers acknowledged.

Sen. Dick Durbin, the No. 2 Senate Democrat, said he traveled through his home state of Illinois this past weekend and when Americans "see us break down into another cussing match over shutting down the government, they say 'for goodness sake, grow up, group up and accept your responsibility."

McConnell, R-Ky., said the "entire fire-drill was completely unnecessary."

With some 80 percent of Americans disapproving of Congress, a remarkable number for a major government institution, outsiders see few winners.

"They don't really realize they are playing Russian roulette," said Robert E. Denton Jr., head of the communications department at Virginia Tech.

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"Obama, Congress divided over terror suspects"
By Donna Cassata, Associated Press, October 5, 2011

WASHINGTON—The Obama administration has tracked down and killed Osama bin Laden, Anwar al-Awlaki and other al-Qaida leaders. Yet, in spite of those successes, Republicans and some Democrats in Congress remain intent on challenging the administration's policies for handling captured terror suspects.

Those lawmakers insist that as a post-Sept. 11 nation wages war in Iraq and Afghanistan, captured terror suspects should be held at the U.S. prison at Guantanamo Bay, Cuba, and prosecuted by military tribunal. They have repeatedly rejected President Barack Obama's push to shutter Guantanamo as well as the administration's effort to detain suspects at facilities in the United States and try them in federal courts.

"It's the ultimate NIMBY situation," said Sen. John McCain, R-Ariz., referring to the not-in-my-backyard argument. Guantanamo is "not going to close. ... I favor closing, but I also favor before announcing its closure finding a place where they could be kept."

Facing fierce congressional resistance, the administration has accepted restrictions on detention of terror suspects. Last year's defense bill and the omnibus spending bill that Obama and Congress agreed to in April barred the transfer of terror suspects from Guantanamo to the United States, prevented construction or modification of U.S. facilities to house suspects, and required the defense secretary to notify Congress before moving a terror suspect to a foreign country.

Now, however, the administration is pushing back by opposing detainee provisions in the latest defense bill. The fight could jeopardize the sweeping $683 billion legislation that would authorize spending on military personnel, weapons systems and the two wars in the fiscal year that began Oct. 1.

Citing administration opposition as well as his own reservations, Senate Majority Leader Harry Reid, D-Nev., said Tuesday he would hold up the bill until concerns over the detainee provisions are settled.

Senate Minority Leader Mitch McConnell, R-Ky., on Wednesday called on Reid to let the Senate debate the bill. McConnell said that if Democrats support the White House in bringing "unlawful enemy combatants to the United States for the purpose of detention and civilian trial," they should consider the provision as part of the bill.

The administration insists that lawmakers are trying to tie the hands of the military, law enforcement and intelligence agents after they've succeeded in killing bin Laden in May and al-Awlaki in Yemen last week, delivering two body blows to al-Qaida. Republicans counter that their efforts are necessary to respond to an evolving, post-Sept. 11 threat and that the administration is being too rigid in ignoring viable options like military commissions.

The dispute comes as a Guantanamo Bay prisoner accused of planning the October 2000 attack on the USS Cole prepares to be arraigned later this month before a military judge at the U.S. Navy base. Abd al-Nashiri, who is charged with murder in violation of the law of war for allegedly planning the attack that killed 17 sailors, would face the first death-penalty war crimes trial for a prisoner at Guantanamo under Obama.

The administration also is considering a military trial in the United States for a Hezbollah commander now detained in Iraq.

The administration's opposition to congressional efforts was clearly spelled out by White House counterterror chief John Brennan, who in a Sept. 16 speech at Harvard University argued for a case-by-case approach in prosecuting terrorist suspects.

"We have established a practical, flexible, results-driven approach that maximizes our intelligence collection and preserves our ability to prosecute dangerous individuals," Brennan said. "Anything less -- particularly a rigid, inflexible approach -- would be disastrous."

The disagreement centers on two competing defense bills, one passed by the Republican-controlled House in May, the other produced by the Democratic-controlled Senate Armed Services Committee in June.

Specifically, the administration finds three provisions -- two in the House bill and one in the Senate -- to be the most problematic.

The House bill would prohibit the transfer or release of terror suspects from Guantanamo to the United States and would prohibit the transfer of terror suspects to foreign countries unless the defense secretary makes several certifications to Congress, including the country's record on terrorism and its detention facility. The Senate bill's provision would require military custody for a terror suspect identified as a member of al-Qaida or an affiliate, or an individual who planned or carried out an attack on the United States.

The Obama administration is trying to sway the opposition by arguing that the House provisions would potentially make it impossible to try terror suspects in federal courts, which in some cases could be the better venue for prosecution, an administration official said. The administration, according to the official, also is sketching a scenario that it argues could take place under the Senate provision: The FBI arrests an individual on a terrorism charge and is eliciting critical information on al-Qaida when, suddenly, the interrogation stops and the FBI has to locate someone in the military to take custody of the suspect.

Various departments and agencies have been in touch with congressional committees, spelling out their concerns with the provisions, the official said. The official spoke on condition of anonymity to describe strategy and discuss private conversations.

Civil liberties groups and other organizations also have weighed in on the provisions. Eleven retired generals, admirals and former judge advocate generals have expressed their opposition to the legislation, saying it "would transform our armed forces into judge, jury and jailor for foreign terrorist suspects. The military's mission is to prosecute wars, not terrorists."

The group argued that suspects could be tried in federal courts on such charges as money laundering and trafficking.

"If Al Capone has been a member of al-Qaida, military commissions would not have been able to convict him of tax evasion," they wrote.

Rep. Adam Smith of Washington state, the top Democrat on the House Armed Services Committee, repeatedly points out that the United States has succeeded in more than 400 cases in federal courts, compared with a handful through military commissions -- which largely haven't been operating for about two years during the Obama administration.

"Why take proven tools out of the toolbox?" Smith said. "The FBI has done an amazing job ... the courts have done an amazing job locking them up."

Republicans argue that Americans overwhelmingly back keeping terror suspects at Guantanamo and out of the United States, and the policy should remain no matter what success Obama has had in killing terrorists. There are 171 prisoners at Guantanamo, and the government has said about 35 could eventually face war crimes charges.

"I applaud everybody involved in killing these terrorists of late. We've been seeking them out and killing them for over a decade and we need to continue," said Rep. Tim Griffin, R-Ark., a member of the House Armed Services Committee. "I don't see how that relates to (federal) courts. The way it's currently constituted is working just fine."

Said Sen. Lindsey Graham, R-S.C.: "We have to have a detention system that allows the warfighter an option other than killing a terrorist. If you captured someone tomorrow, where would you put him? The only available jail is Guantanamo Bay."

With some 12 weeks left in the congressional session, Sen. Carl Levin, D-Mich., the chairman of the Senate Armed Services Committee, and McCain, the panel's top Republican, are trying to come up with a compromise to deal with the detainee provision problems.

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"Secret U.S. Memo Made Legal Case to Kill a Citizen"
The New York Times - October 8, 2011

The Obama administration’s secret legal memorandum that opened the door to the killing of Anwar al-Awlaki, the American-born radical Muslim cleric hiding in Yemen, found that it would be lawful only if it were not feasible to take him alive, according to people who have read the document.

The memo, written last year, followed months of extensive deliberations and offers a glimpse into the legal debate that led to one of the most significant decisions made by President Obama — to move ahead with the killing of an American citizen without a trial.

The memo provided the justification for acting despite an executive order banning assassinations, a federal law against murder, protections in the Bill of Rights and various strictures of the international laws of war, according to people familiar with the analysis. The memo, however, was narrowly drawn to the specifics of Mr. Awlaki’s case and did not establish a broad new legal doctrine.

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"Obama says to keep standing up to Congress on taxes"
By Laura MacInnis | Reuters – December 11, 2011

WASHINGTON (Reuters) - President Barack Obama defended his leadership style on Sunday and said he would keep standing up to Congress as another stand-off over taxes and deficits brewed on Capitol Hill.

In an interview on CBS' "60 Minutes," Obama suggested his wife, Michelle, had mixed feelings about their time in the White House but said he had no hesitation about seeking re-election next year, saying he wanted to finish the job of putting the U.S. economy on stronger, and fairer, footing.

Asked if he'd had any doubts about pursuing a second term, given so many of his supporters have been disappointed by his struggles to get things done in a divided Washington, Obama said: "No."

"Not because our quality of life might not be better if I were not president. Not because Michelle is so enamored with me being president. But because we both think that what we're doing is really important for a lot of people out there," he said, saying it was inevitable his approval ratings would slip once he took office.

"If my goal was to maintain the extraordinary popularity that I had right after I made my convention speech in 2004, then I would have never left the Senate," he said. "I wouldn't have been leading this country, but people would be really attracted, because I wouldn't have had to make any choices and make any decisions and exercise any responsibility. I took a different path. And as Michelle reminds me, 'You volunteered for this thing.'"

A majority of Americans believe Obama does not deserve a second four-year term, according to recent polls, which show only about a third of the country gives the Democrat good marks for his handling of the economy.

The White House has sought to stress that Obama inherited a fragile economy from his Republican predecessor George W. Bush, who also added to the U.S. debtload with aggressive spending on the wars he waged in Iraq and Afghanistan.

But many voters fault Obama for failing to kickstart growth and slash the jobless rate, which at 8.6 percent remains about double the level considered normal for the United States.

Republican contenders for the White House, including Newt Gingrich and Mitt Romney, have said the president was not up to the task of steering the country out of economic crisis.

UNSATISFIED

Obama has also drawn criticism for failing to overcome an impasse with Republicans in Congress, who brought the United States to the verge of sovereign default in August in a fight about U.S. debt levels and then blocked his $447 billion jobs bill to resist tax increases on the wealthy.

With another battle heating up, this time over payroll tax cuts and jobless benefits that Obama wants extended before the end of the year, the president said he would keep pushing for a deal that requires rich Americans to "pay a little more."

Republicans have said that raising taxes on the rich would punish entrepreneurs and dent hiring, and they want to see spending cuts to ensure the payroll and unemployment moves do not add to already-large U.S. deficits.

They have accused Obama of turning his back to Congress and making a series of campaign-style economic speeches on the road instead of sitting down to negotiate workable remedies.

In the CBS interview, the president said that while he wanted to work with Congress on "common sense" solutions, Republicans intent on ousting him had "made a different calculation, which was, 'You know what? We really screwed up the economy. Obama seems popular. Our best bet is to stand on the sidelines, because we think the economy's going to get worse, and at some point, just blame him.'"

He said the American people "shouldn't feel satisfied" at present and he said he would keep pushing Republicans to "get off the dime" about taxes and ask his fellow Democrats in Congress to accept reforms to benefit programs so long as the cuts don't take effect while growth remains weak.

"We've got a lot more work to do in order to get this country and the economy moving in a way that benefits everybody, as opposed to just a few," he said, later adding it would take "more than one term" to fulfill his 2008 campaign pledge to change Washington's culture and put partisanship aside to tackle big problems.

"The one thing I've prided myself on before I was president, and it turns out that continues to be true as president: I'm a persistent son of a gun. I just stay at it. And I'm just going to keep on staying at it as long as I'm in this office," he said.

On Sunday morning, Obama and his family attended a church service near the White House where Reverand Luis Leon referenced the president in a sermon about "disillusionment," saying many people had unfairly expected Obama could cure the United States of all its problems when he took office.

"This is not a political diatribe by the way. It's simply stating the obvious," he said to laughter in the congregation.

(Additional reporting by Anna Yukhananov)

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"Reader: New legislation is a cause for action"
The North Adams Transcript, Letter to the Editor, December 27, 2011

To the Editor:

I am feeling a bit like Alice these days, tumbling down the rabbit hole and wondering how deep the rabbit hole goes.

There’s nothing subtle about what’s gone wrong with our country, politics, democracy and economy, and nothing inconspicuous about how we got here. Yet huge numbers of people can’t see it. And perhaps more disconcertingly, larger numbers are just sitting by watching it, "finding it easier to live in the world they’ve been given, than to explore the power they have to change it," to quote Muhammad Ali.

I understand the Machiavellian lust for power and profligate greed. Sadly, they define human history. But, these are "my" times. What I don’t understand is our complacency, lack of outrage and passive acceptance of the severe consequences that befall us due to the egregious misdeeds of the powerful and rich, and our impotence to hold them accountable.

How is it that Bush and Cheney, who admit to ordering crimes against humanity, go unpunished while a private who exposes them faces life in military prison? How is it that those who crashed our economy and stole our money are rewarded and not held accountable while the victims, protesting against their crimes, are subject to paramilitary responses, pepper sprayed and jailed? How is it that our Supreme Court, Congress and two presidents can blatantly violate our Constitution without massive public backlash?

Recently, President Obama signed into law the National Defense Authorization Act. According to this bill, "the U.S. military can now bust down your door at any time (given the proper go ahead by the executive branch), take you away, never charge you with a crime, never give you a trial, and lock you up, torture you, or even kill you," according to a story on dailykos.com. This bill was passed, according to our Congress and president, to "protect" America.

They voted, in violation of the Constitution, to overturn the Bill of Rights and fundamentally change our democracy. In short, the terrorists have won.

"There’s a reason you separate the military and the police. One fights the enemies of the state, the other serves and protects the people. When the military becomes both, the enemies of the state tend to become the people," to quote BattleStar Galactica’s Commander Adama.

If shredding the Constitution doesn’t rile the masses to action, I cannot fathom what will. As I see it, our "only" hope is massive civil disobedience, aka the Occupy Movement. Don’t sit and watch it -- join it and stand-out in protest!

Peter D. May
North Adams, Massachusetts
Dec. 24, 2011

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"Obama signs defense bill despite 'reservations'"
By Julie Pace, Associated Press, December 31, 2011

HONOLULU—President Barack Obama signed a wide-ranging defense bill into law Saturday despite having "serious reservations" about provisions that regulate the detention, interrogation and prosecution of suspected terrorists.

The bill also applies penalties against Iran's central bank in an effort to hamper Tehran's ability to fund its nuclear enrichment program. The Obama administration is looking to soften the impact of those penalties because of concerns that they could lead to a spike in global oil prices or cause economic hardship on U.S. allies that import petroleum from Iran.

In a statement accompanying his signature, the president chastised some lawmakers for what he contended was their attempts to use the bill to restrict the ability of counterterrorism officials to protect the country.

Administration officials said Obama was only signing the measure because Congress made minimally acceptable changes that no longer challenged the president's terrorism-fighting ability.

"Moving forward, my administration will interpret and implement the provisions described below in a manner that best preserves the flexibility on which our safety depends and upholds the values on which this country was founded," Obama said in the signing statement.

Signing statements allow presidents to raise constitutional objections to circumvent Congress' intent. During his campaign for the White House, Obama criticized President George W. Bush's use of signing statements and promised to make his application of the tool more transparent.

Obama's signature caps months of wrangling over how to handle captured terrorist suspects without violating Americans' constitutional rights. The White House initially threatened to veto the legislation but dropped the warning after Congress made last-minute changes.

Among the changes the administration secured was striking a provision that would have eliminated executive branch authority to use civilian courts for trying terrorism cases against foreign nationals.

The new law now requires military custody for any suspect who is a member of al-Qaida or "associated forces" and involved in planning or attempting to carry out an attack on the United States or its coalition partners. The president or a designated subordinate may waive the military custody requirement by certifying to Congress that such a move is in the interest of national security.

The administration also pushed Congress to change a provision that would have denied U.S. citizens suspected of terrorism the right to trial and could have subjected them to indefinite detention. Lawmakers eventually dropped the military custody requirement for U.S. citizens or lawful U.S. residents.

"My administration will not authorize the indefinite military detention without trial of American citizens," Obama said in the signing statement. "Indeed, I believe that doing so would break with our most important traditions and values as a nation."

Despite the changes, officials cited serious concerns that the law will complicate and could harm the investigation of terrorism cases.

For example, FBI Director Robert Mueller has said the measure would inhibit his bureau's ability to persuade suspected terrorists to cooperate immediately and provide critical intelligence. He told Congress it wasn't clear how agents should operate if they arrest someone covered by the military custody requirement but the nearest military facility is hundreds of miles away.

Other officials have said agents and prosecutors should not have to spend their time worrying about citizenship status and whether get a waiver while trying to thwart a terror attack.

The administration also raised concerns about an amendment in the bill that goes after foreign financial institutions that do business with Iran's central bank, barring them from opening or maintaining correspondent operations in the United States. It would apply to foreign central banks only for transactions that involve the sale or purchase of petroleum or petroleum products.

Officials worry that the penalties could lead to higher oil prices, damaging the U.S. economic recovery and hurting allies in Europe and Asia that purchase petroleum from Iran.

The penalties do not go into effect for six months. The president can waive them for national security reasons or if the country with jurisdiction over the foreign financial institution has significantly reduced its purchases of Iran oil.

The State Department has said the U.S. was looking at how to put them in place in a way that maximized the pressure on Iran, but meant minimal disruption to the U.S. and its allies.

This week, Iran warned that it may disrupt traffic in the Strait of Hormuz -- a vital Persian Gulf waterway. But on Saturday, Tehran seemed to back off that threat when a commander of its Revolutionary Guard said such discussion is a thing of the past and "belongs to five years ago."

Iran also said Saturday that it had proposed a new round of talks on its nuclear program with the U.S. and other world powers. The invitation would come after the U.N. has imposed four rounds of sanctions. Separately, the U.S. and the European Union have imposed their own tough economic and financial penalties.

The $662 billion bill authorizes money for military personnel, weapons systems, the wars in Afghanistan and Iraq and national security programs in the Energy Department for the fiscal year beginning Oct. 1.

The measure also freezes some $700 million in assistance until Pakistan comes up with a strategy to deal with improvised explosive devices.

Obama signed the bill in Hawaii, where he is vacationing with his family.

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"Defense Act threatens our freedoms"
The Berkshire Eagle, Letter to the Editor, January 5, 2012

This is in reference to Don Allen's Dec. 25 letter "Sixth Amendment isn't applicable." Mr. Allen takes issue with a previous letter by Jose Lu who argued that portions of the new defense act violate the Sixth Amendment to the Constitution, citing specifically "In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial." Mr. Allen rebuts by writing "It seems clear that the Sixth Amendment applies to common criminals, and not to enemies of the U.S."

Actually, Mr. Allen, the Sixth Amendment doesn't apply to criminals either, common or uncommon. It applies to citizens who have only been "accused" of violating United States law. They are not presumed to be criminals; to the contrary, they are presumed innocent until proven guilty, and that can best be determined through "the right to a speedy and public trial."

Taking this further, Mr. Allen believes the Sixth Amendment does not apply to "enemies of the U. S." But it does apply to citizens who have been "accused" of being enemies of the U.S., and these are the very people Mr. Allan wants swept up and held indefinitely without trial.

Mr. Allen seems to assume that innocent people are never arrested or incarcerated, and no one has ever been falsely accused. It's a wonder we have a need for a judicial system at all, so perfect is Mr. Allen's faith in the intentions and judgment of our elected representatives.

And what happens when I demonstrate against going to war with, say, Iran, which might or might not pose a threat to neighboring countries and allies? Will I be considered an enemy of the state because a small cadre of people in power interpret my actions as a threat to national security? And I won't have my day court will I Mr. Allen?

Mr. Allen also supports that part of the defense act that states that citizens may be held in "detention under the laws of war without trial until the end of the hostilities." Perhaps he will define -- in legal terms -- the exact meaning of "hostilities," because, from my point of view, hostilities will not end for generations, if ever. The "war" in Iraq has officially come to an end. The "war" in Afghanistan is winding down. But the "hostilities" with terrorist groups will not. We wear hostilities like a glove.

The level of judgment expressed by Mr. Allan is, unfortunately, not unusual, and those who legislate such dangerous threats to individual freedom count on that. There are those in office today who would love to suppress free speech and this is the document that brings us one step closer to that reality. The enemies of the state, in my mind, are those who conceived, legislated, passed, and support the above-mentioned portions of the new defense act.

JEFFREY REEL
Becket, Massachusetts

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"Elizabeth Warren lauds naming of consumer chief"
By Associated Press, Local Politics, bostonherald.com - January 4, 2012

BOSTON — Democratic U.S. Senate hopeful Elizabeth Warren is praising President Barack Obama’s decision to name Richard Cordray as the nation’s chief consumer watchdog over the objections of Senate Republicans.

Warren called Cordray an "exceptional choice" to lead the Consumer Financial Protection Bureau.

Warren, a Harvard professor and consumer advocate, led the push for the new agency and was briefly considered as a candidate to head it.

Warren criticized Republicans for trying to block Cordray’s appointment, saying they were frustrating efforts to hold large banks accountable for bringing the nation’s economy to its knees.

U.S. Sen. Scott Brown, the Republican incumbent Warren is hoping to oust, had already broken with fellow GOP senators and called for an up or down vote on Cordray.

Brown also said he supports Cordray’s nomination.

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President Obama makes remarks about government reform in the East Room of the White House on Friday (January 13, 2012). (Doug Mills/The New York Times)

"Obama to Ask Congress for Power to Merge Agencies"
By MARK LANDLER, N.Y. Times, January 13, 2012

WASHINGTON — President Obama announced a new campaign on Friday to shrink the federal government, a proposal notable less for its goal — the fight against bloat has been championed by every modern-day president — than for its challenge to a hostile Congress.

Mr. Obama called on lawmakers to grant him broad new authority to propose mergers of government agencies, which the Congress would have to approve or reject in an up-or-down vote.

The president, announcing the plan at the White House, said he would begin his pruning exercise by folding the Small Business Administration and five other agencies involved in trade and business, into a single agency that would replace the Commerce Department.

The White House said the consolidation would save $3 billion over 10 years and result in the elimination of 1,000 to 2,000 jobs, though he said those reductions would occur through attrition rather than layoffs.

“From the moment I got here, I saw up close what many of you know to be true: the government we have is not the government we need,” Mr. Obama told an audience of small business owners.

It is not clear whether Congress, which has blocked the bulk of Mr. Obama’s legislative agenda, will go along with the initiative. White House officials said that no president since Ronald Reagan has had the so-called “consolidation authority” Mr. Obama is seeking.

Republicans were immediately skeptical. They suggested that the White House was more interested in honing its re-election message than in reducing the size of government.

“Yesterday, President Obama asked for a $1.2 trillion increase in the debt limit, today he is proposing to shrink the federal government,” said Senator John Cornyn, Republican of Texas. “Unfortunately, President Obama does not have much of a record to back up his newfound, election-year enthusiasm for limited government.”

A spokesman for House Speaker John A. Boehner said that Republicans would take a look at the plan.

“We hope the president isn’t simply proposing new packaging for the same burdensome approach,” said the spokesman, Brendan Buck. “However, eliminating duplicative programs and making the federal government more simple, streamlined, and business-friendly is always an idea worth exploring. We look forward to hearing more about his proposal.”

By putting the onus for streamlining government on Congress, however, Mr. Obama was seizing a core issue of Republican presidential candidates like Mitt Romney — the inexorable growth of the federal government — and trying to turn it to his own political advantage.

It was the latest sally by the president, who has gone on the offensive against Congress as he embarks on his re-election bid. He appointed a new head of the Consumer Financial Protection Bureau, Richard Cordray, as well as other appointees to regulatory agencies, during a Congressional recess, to get around the opposition of lawmakers.

Under the terms of the reorganization proposed Friday, six relatively small agencies — the Small Business Administration, the Office of the United States Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation, and the Trade and Development Agency — would be consolidated into a single agency focused on opportunities for the private sector.

The administrator of the Small Business Administration, currently Karen G. Mills, would be elevated to the cabinet.

To illustrate the tangled maze of government services for businesses, the president gestured toward a screen behind him that showed the dozens of Web sites, offices, and customer service centers that a company must contend with, many with overlapping functions.

Mr. Obama championed the goal of streamlining government during his State of the Union address last year. On Friday, he cited an example of duplication from that speech: the Interior Department oversees salmon in fresh water, while the Commerce Department has jurisdiction over them in salt water.

The president said he would use the “consolidating authority” only for bureaucratic reorganizations that cut costs and made the government more efficient. And he challenged Republican lawmakers to support an idea that they themselves have embraced.

“With or without Congress, I’m going to keep at it, but it would be easier if Congress helped,” Mr. Obama said. “This is an area where we should receive bipartisan support because making our government more responsive and strategic and leaner should not be a partisan issue.”

One government efficiency expert, Jitinder Kohli, applauded the move.

“These efforts to rationalize government are long overdue, frankly,” said Mr. Kohli, a senior fellow at the left-leaning Center for American Progress. “In fiscally tight times, it’s even more important to think carefully about how to deliver savings — and that includes making Web sites easier to use, providing single points of entry and streamlining.”

“In the world of business, reorganization happens all the time, for good reason,” Mr. Kohli added. “The world changes around businesses, and businesses change to better serve the world. But the government is far, far less nimble.”

Still, a body of research throws cold water on the notion that such reorganization leads to lower head counts, more effective departments or cost savings.

“The most important considerations are the costs in wasted time while they do the reorganization, how this changes the politics of the affected agencies in relation to Congress and other executive branch agencies, and how specific the purported benefits of consolidation are,” said Steven M. Teles, an associate professor of political science at Johns Hopkins University. “My gut tells me those benefits will end up being much smaller than advertised, and the costs much larger.”

Daniel W. Drezner, a professor of international politics at Tufts, said” “This is one of those ideas that looks great in abstract. But you’re talking about merging the organizational cultures of five or six agencies. It takes a long time for efficiencies and synergies to work out. They’re not going to play well for a while.”

Nonetheless, Professor Drezner said that having a single body devoted to export promotion made sense.

“If you look at American exports, it’s dominated by big business,” he said. “If you want small and medium enterprises to get more involved in exporting” — a goal of the Obama administration — “having small business and the trade office in the same agency makes sense. So this could be a boon for that.”

Susan C. Schwab, who served as a United States trade representative during the Bush administration, agreed that the move might improve export promotion. But she said that it might do so at the expense of broader trade policy.

“You’d take a small, very efficient agency and have it totally swallowed up by this behemoth,” said Ms. Schwab, who is now a professor of public policy the University of Maryland. “From a trade policy perspective, it makes no sense at all.”

Ms. Schwab added: “Trade policy involves so many different sectors of the economy, and U.S. interests It’s foreign policy. It’s manufacturing. It is services, agriculture, consumers, labor, the environment, intellectual property.”

An agency without a strong trade representative, she said, could end up giving “short shrift” to some concerns.

Annie Lowrey contributed reporting.

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"Fed to Maintain Rates Near Zero Through Late 2014"
The New York Times, January 25, 2012

The Federal Reserve said Wednesday that it intends to hold short-term interest rates near zero “at least through late 2014.”

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In his State of the Union address Tuesday, President Obama presented a list of economic proposals, including tax code changes.

"In Address, Obama Makes Pitch for Economic Fairness"
By HELENE COOPER, N.Y. Times, January 24, 2012

WASHINGTON — President Obama pledged on Tuesday night to use government power to balance the scale between America’s rich and the rest of the public, trying to present an election-year choice between continued leadership toward an economy “built to last” and what he called irresponsible policies of the past that caused an economic collapse.

Declaring that “we’ve come too far to turn back now,” the president used his final State of the Union address before he faces the voters to showcase the extent to which he will try to contrast his core economic principles with those of his Republican rivals in a time of deep economic uncertainty. While many Americans remain disappointed with the state of the economy and the president’s handling of it, Mr. Obama nonetheless tried to bring into relief the difference between where the country was when he took over and where it is now.

“The state of our union is getting stronger,” he declared in time-honored tradition. “In the last 22 months, businesses have created more than three million jobs.” He pointed to renewed hiring by American manufacturers and — borrowing the “built to last” phrase from the auto industry he helped save — he sketched out, albeit vaguely, what he called a blueprint for economic growth in which the wealthy play by the same rules as ordinary Americans.

Republicans challenged Mr. Obama’s assessment of the economy, and asserted that his policies had made the situation worse. But with their own poll numbers diving, Congressional Republicans were subdued in their response to the speech, careful not to boo or seem disrespectful. And the president disputed their claim that he was practicing the politics of division.

“You can call this class warfare all you want,” Mr. Obama said of his call to create a more even economic playing field. “Most Americans would call that common sense.” He characterized the choice as one between whether “a shrinking number of people do really well while a growing number of Americans barely get by” or his own vision — “where everyone gets a fair shot.”

In returning to his 2008 campaign motif of these being “not Democratic values or Republican values, but American values,” Mr. Obama presented a somewhat modest list of initiatives he could enact through executive authority coupled with more ambitious proposals unlikely to advance in Congress. It was an address meant to show a president still interested in governing and a leader putting the interests of the American middle class at the top of his agenda.

Many of his proposals centered on changes to the tax code, including limiting deductions for companies that move jobs overseas, rewarding companies that return jobs to the United States and increasing taxes on wealthy Americans.

Taking aim at financial institutions that engaged in risky lending practices that many believe tipped the country into financial crisis, Mr. Obama said he was asking Attorney General Eric H. Holder Jr. to create a special unit of federal prosecutors and state attorneys general to expand investigations into abusive lending. The new unit, he said, “will hold accountable those who broke the law, speed assistance to homeowners and help turn the page on an era of recklessness that hurt so many Americans.”

Mr. Obama also proposed a new trade enforcement unit that would add to the number of government investigators pursuing unfair trade practices and that would be responsible for filing lawsuits against foreign countries, namely China. He called for new legislation to make it easier for Americans to refinance their homes if their interest rates are above market rates. And he proposed a bound-to-be-contentious way to allocate any savings from ending the war in Iraq and winding down the war in Afghanistan: by using half of the war savings on infrastructure projects and the other half to reduce the deficit.

“We will not go back to an economy weakened by outsourcing, bad debt and phony financial profits,” Mr. Obama said. Though his advisers have vowed a campaign against Congress, he expressed a willingness to “work with anyone in this chamber” and said he would “oppose any effort to return to the very same policies that brought on this economic crisis in the first place.”

In an emotional moment, Representative Gabrielle Giffords, an Arizona Democrat who was wounded in the Tucson shooting last year, returned for the speech before her imminent resignation from the House to concentrate on her recovery. Although the president is often criticized for his aloofness, he embraced Ms. Giffords for a long 10 seconds, rocking and almost seeming to be dancing with her.

Mr. Obama again proposed changes to the tax code so the wealthy pay more, a position he has indicated he will continue to press in this election year against Republican opposition. He called for Congress to put into place his “Buffett Rule” — named after the Berkshire Hathaway chairman Warren E. Buffett — whereby people making more than $1 million a year would pay a minimum effective tax rate of at least 30 percent in income taxes.

To illustrate his point, he provocatively used Mr. Buffett’s secretary, Debbie Bosanek, as one of his props, seating Ms. Bosanek — whose effective tax rate is higher than Mr. Buffett’s, he has said — in the chamber with the first lady, Michelle Obama.

Mr. Obama’s income tax proposal on Tuesday night was particularly charged, coming as it did less than 24 hours after Mitt Romney, a Republican presidential candidate, released tax returns showing that he and his wife, Ann, had an effective federal income tax rate in 2010 of 13.9 percent and an income ranking among the top one-10th of 1 percent of all taxpayers in 2010.

Mr. Obama would like the new tax to replace the alternative minimum tax, which was created decades ago to make sure that the richest taxpayers with plentiful deductions and credits did not avoid income taxes, but which now affects millions of Americans who are considered upper middle class.

An upbeat Mr. Obama delivered his remarks standing in the chamber of the House of Representatives, an arena ruled by his political adversaries, given the Republican majority that the president and fellow Democrats have criticized as blocking much of the White House agenda.

But in the official Republican response to the address, Gov. Mitch Daniels of Indiana said it had been Congressional Republicans who had acted to improve the economy, only to be thwarted by the president.

“The president did not cause the economic and fiscal crisis that continue in America tonight,” Mr. Daniels said. “But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse.”

While he was addressing Congress and assembled dignitaries, Mr. Obama was trying to reach the far greater national television audience of American voters, and his speech, while deep in policy initiatives, served in many ways as a prime-time kickoff of his re-election campaign.

In fact, most of the first lady’s guests on Tuesday night came from states that figure heavily in Mr. Obama’s re-election plans. Included were North Carolina, from where Mr. Obama selected both a worker and an employer, to demonstrate the benefits of public-private partnerships, and Florida, from where he chose a homeowner who was able to keep her house thanks to Mr. Obama’s housing refinance program.

Mr. Obama said a major part of his agenda would be the expansion of domestic energy supplies, both from traditional fuels like oil and natural gas and from cleaner sources like wind and the sun. He singled out the rapid growth of domestic natural gas production through the technique known as hydraulic fracturing, or fracking, which the government says has unlocked a 100-year supply that now makes the United States the Saudi Arabia of natural gas.

Reflecting the heavy emphasis on the economy in an election year, the president’s speech was relatively short on national security, where most political observers and indeed his own aides believe his performance has been much stronger than on the economy. In fact, Mr. Obama ended his speech with the American assault last year that finally, after 10 years, killed Osama bin Laden, and talked of that fateful day last May when he monitored the attack from the White House.

He called on the country to emulate the unity of the Navy Seal team that conducted the raid. “When you’re marching into battle, you look out for the person next to you,” the president said, “or the mission fails.”

John M. Broder contributed reporting.

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"U.S. Economy Added 243,000 Jobs in January; Unemployment Dips to 8.3%"
The New York Times, February 3, 2012

The United States economy gained momentum in January, adding 243,000 jobs, the second straight month of better-than-expected gains, the Labor Department reported on Friday. The unemployment rate fell to 8.3 percent. The promising jobs numbers came as various economic indicators have painted an ambivalent picture of the recovery’s strength.

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"Obama's budget offers short-term help for economy"
By MARTIN CRUTSINGER | Associated Press – February 12, 2012

WASHINGTON (AP) — The president will send Congress a budget that will provide short-term help to a struggling economy while offering a long-term plan to deal with soaring deficits, the White House said Sunday. Republicans attacked the spending blueprint as offering more of the same failed solutions for the economy.

The 2013 budget being released Monday will propose public works spending while seeking tax increases on the wealthy and corporations to claim progress on the federal deficit in his upcoming budget. The spending plan projects a deficit for this year of $1.3 trillion, the fourth straight year of $1 trillion-plus deficits, and $901 billion next year.

Jacob Lew, the president's chief of staff, said the new budget would put the country on track to achieve $4 trillion in deficit reductions over the next 10 years, achieved by raising taxes on the wealthy and trimming government spending. Lew said the president's budget would cut spending by $2.50 for every $1 it raises in new taxes.

"In the long run, we need to get the deficit under control in a way that builds the economy," Lew said during appearances on the Sunday talk shows. "We do it in a way that's consistent with American values so that everyone pays a fair share."

The release of Obama's spending plan for the budget year that begins Oct. 1 marks the official start to an election-year budget battle over taxes and spending as the nation's debt tops $15 trillion.

Republicans on Sunday criticized the document for its proposals to increase spending in such areas as infrastructure and for its tax increases.

House Republicans will put forward a sharp alternative to Obama's plan that will provide deficit reduction through an overhaul of Medicare and other programs and without tax increases.

"We're taking responsibility for the drivers of our debt," said the chairman of the House Budget Committee, Rep. Paul Ryan, R-Wis. "So when the dust settles and people see actually what we're doing, how we're promoting bipartisan solutions."

The president's plan is laden with stimulus-style initiatives, like sharp increases for highway construction, school modernization, and a new tax credit for businesses that add jobs. But it avoids sacrifice, with only minimal curbs on the unsustainable growth of Medicare even as it slaps a 10-year, $61 billion "financial crisis responsibility fee" on big banks to recoup the 2008 Wall Street bailout.

The budget, administration officials say, borrows heavily from Obama's September submission to a congressional deficit "supercommittee" assigned to come up with at least $1.2 trillion in deficit savings as part of last summer's budget-and-debt pact that avoided a first-ever U.S. default on its obligations. The panel deadlocked and left Washington to grapple with bruising across-the-board spending cuts that kick in next January.

Obama's plan predicts deficit savings of more than $4 trillion over a decade, mixing $1 trillion already banked through last summer's clampdown on agency operating budgets with $1.5 trillion in higher tax revenues reaped from an overhaul of the tax code. It also claims savings from reduced war costs and takes just a nip at federal health care programs even as it promises $476 billion for road and other surface transportation programs over six years, a significant increase.

It's already received a chilly reception from Republicans who say Obama isn't doing enough to tame the deficit or curb the rapid growth of benefit programs like Medicare.

The budget will also call for a "Buffett Rule" named after billionaire Warren Buffett that would guarantee that households making more than $1 million a year pay at least 30 percent of their income in taxes.

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"Treasury to release corporate tax plan Wednesday"
By Jim Kuhnhenn, Associated Press, February 21, 2012

WASHINGTON — The Obama administration will propose lowering the current 35 percent corporate tax rate, while at the same time eliminating loopholes and subsidies and imposing a minimum tax on the overseas profits of American companies.

Administration officials said the Treasury Department on Wednesday will detail aspects of President Barack Obama's proposed overhaul of the corporate tax system, a plan he broadly outlined in his State of the Union speech last month.

The 35 percent nominal corporate tax rate is the highest in the world after Japan. But deductions, credits and exemptions allow many corporations to pay taxes at a much lower rate.

The administration plan is not likely to go as far as a House Republican proposal to lower the rate to 25 percent. But Treasury Secretary Timothy Geithner told a House committee last week that the administration wants to create more incentives for corporations to invest in the United States.

"We want to bring down the rate, and we think we can, to a level that's closer to the average of that of our major competitors," Geithner told the House Ways and Means Committee.

Treasury will be offering broad principles of its plans but will not offer specific legislation, the administration officials said, speaking on condition of anonymity to describe what the administration will do. As a result, the administration's plan will serve more as a marker in a debate that most expect will extend throughout this year's presidential election with little to no chance of enactment.

The administration officials outlined the plans Tuesday on condition of anonymity ahead of Treasury's announcement.

While providing no specifics, Obama has said corporate tax rates are too high and has proposed eliminating tax breaks for American companies that move jobs and profits overseas. He has also proposed giving tax breaks to U.S. manufacturers, to firms that return jobs to this country and to companies that relocate to some communities that have lost big employers.

White House economic adviser Gene Sperling has said the administration also is seeking a minimum tax on global profits. Currently many corporations do not invest overseas profits in the United States to avoid the 35 percent tax rate.

Many members of both parties have said they favor overhauling the nation's individual and corporate tax systems, which they complain have rates that are too high and are riddled with too many deductions.

The corporate tax debate has also become an element of presidential politics. Former Massachusetts Gov. Mitt Romney has called for a 25 percent rate, former House Speaker Newt Gingrich, R-Ga., would cut the corporate tax rate to 12.5 percent, and former Sen. Rick Santorum, R-Pa., would exempt domestic manufacturers from the corporate tax and halve the top rate for other businesses.

While Obama has been promoting various aspects of his economic agenda in personal appearances and speeches, officials said he was leaving the corporate tax plan to the Treasury Department to unveil, a signal of its lower priority.

Associated Press writer Alan Fram contributed to this report.

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