Obama strikes frank but optimistic note in speech

President calls energy, education, health care three critical economic areas

WASHINGTON (MarketWatch) -- The United States will emerge from the recession "stronger than before," President Barack Obama said Tuesday night in his first address before a joint session of Congress, laying bare the challenges facing the U.S. economy and detailing proposals to turn it around.

In a lengthy speech, an animated but serious-looking Obama laid out more of his economic agenda, promising job creation, a doubling of renewable-energy production, health-care reform and a bolstering of education.

Turning his sights to an anxious country beset by jittery financial markets and staggering job losses, Obama said Americans must pull together and confront the challenges facing it.

"While our economy may be weakened and our confidence shaken, though we are living through difficult and uncertain times, tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before," Obama said to sustained applause.

Long-term challenges
Obama named energy, health care and education as three areas that are "absolutely critical to our economic future" and said his budget would invest in all three.
The president spoke just two days ahead of the rollout of his fiscal 2010 budget, and he used the speech to preview items in it and to detail how he plans to make good on his pledge to halve the deficit by the end of his first term.

On energy, he said he'll invest $15 billion a year to develop wind and solar power and other clean technologies, as well as in fuel-efficient American-built cars and trucks.
Obama is set to convene a health-care summit next week. He plans to reduce the health-care costs of the average family by $2,500 a year, he said. He also said his budget creates new incentives for teacher performance and expands the U.S. commitment to charter schools.

A day after pledging to cut the deficit in half, Obama said that he and his economic team have identified $2 trillion in savings.

"We will end education programs that don't work and end direct payments to large agribusinesses that don't need them," Obama said Tuesday night. He also targeted "no bid" military contracts, waste in Medicare and tax breaks for corporations that "ship our jobs overseas."

Defending bailouts
In reaching out to jittery consumers, Obama sought to assure Americans that the financial system is sound and saying bank deposits are safe and that insurance is secure.

He defended the administration's bailout plans for financial institutions. On Tuesday, a New York Times/CBS News poll found that a majority of respondents thought the administration's plans so far would benefit bankers, not all Americans.

Tuesday's speech came as Obama enjoyed high ratings in two separate new polls. The latest New York Times/CBS News poll shows Obama's job approval rating at 63%, and the latest Washington Post-ABC News poll puts the figure at 68%.
Wall Street closed higher Tuesday, with the Dow Jones Industrial Average rising 236 points.

Obama said the stimulus plan would save or create 3.5 million jobs over the next two years, and poll respondents are showing faith in the huge spending and tax-cut package.
However, the Times reported, half of those polled said it's not likely to shorten the recession, and just over two-thirds expect more money ultimately will be needed to right the economy.

Tuesday's speech came a day after Obama convened a "fiscal responsibility summit" at the White House, to gather ideas about reducing the budget deficit and shoring up entitlements and health care over the long haul.

Republican rebuttal
Republicans rebutted Obama's speech by warning about spending too much in the stimulus and on government programs.

"Democratic leaders say their legislation will grow the economy," Gov. Bobby Jindal of Louisiana said just after the Obama address. Jindal, the son of Indian immigrants, is a rising star in his party. See full text of Bobby Jindal's address.

"What it will do is grow the government, increase our taxes down the line, and saddle future generations with debt. Who among us would ask our children for a loan, so we could spend money we do not have, on things we do not need?" Jindal said.

"That is precisely what the Democrats in Congress just did. It's irresponsible. And it's no way to strengthen our economy, create jobs, or build a prosperous future for our children," Jindal said.

Obama's speech was punctuated by frequent applause from the majority-Democratic Congress.
Sitting in First Lady Michelle Obama's box were guests including Earl Devaney, a former Secret Service agent who will oversee the stimulus spending, and Lilly Ledbetter, the plaintiff in a high-profile equal-pay case.

Robert Schroeder is a reporter for MarketWatch in Washington.
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Discussion Ideas:

Did you watch the speech, or see highlights? What was your general impression?

Both President Obama and Gov. Bobby Jindal stated that we should not burden future generations with debt from our spending. Obama says that the stimulus program will help abate this concern, and Jindal says that the stimulus program will add to the problem.
How is it that both parties have the same concern, but differ so widely on the proposed solution?

One point tat Obama made during his speech about the auto industry was that aid given to U.S. auto companies was not to be seen as a reward for their lack of success in business, but rather is to be used in restructuring their business and products to be competitive in the new marketplace. Do you think that American auto companies will be capable of re-inventing themselves and bring to market eco-friendly cars?
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