Obama: Income inequality “the defining challenge of our time”
President Obama on Wednesday pointed to a combination of growing income
inequality and a lack of upward mobility as “the defining challenge of our
time,” arguing the government should take further steps to reverse a
decades-long trend that has widened the gap between the nation’s richest
citizens and everyone else.
“The basic bargain at the
heart of our economy has frayed,” Mr. Obama said. He repeated later in his
speech that “the combined trends of increased inequality and decreasing
mobility pose a fundamental threat to the American dream, our way of life, and
what we stand for around the globe.”
The president’s
speech, from a community center in Anacostia, one of the poorest sections of Washington, D.C., is an attempt to reclaim the agenda for the remainder of
his presidency. Still, he acknowledged that his administration’s “poor execution”
of the health care law and a “reckless shutdown” that froze Washington for half
of October, which he attributed to congressional
Republicans, had taken a toll on the public’s trust of government.
“Nobody has
acquitted themselves very well these past few months. So it’s not surprising
that the American people’s frustrations with Washington are at an all-time
high,” he said.
During one of the
longest speeches he has given this year, Mr. Obama paid homage to his
predecessors, including Franklin and Teddy Roosevelt and Abraham Lincoln, who
used government to create opportunities and weave safety nets for more people
in the United States. It was a follow up on a speech he delivered in
Osawatomie, Kansas – the site of Teddy Roosevelt’s “New Nationalism” speech a
century earlier – to lay out some of the major
economic themes of his 2012
campaign.
He warned that the
social compact has broken down since the 1970s, when a combination of
technological advancements, globalization, a breakdown of communities, weakened
unions, and increased lobbying by businesses weakened the country’s economic
foundation and vastly increased the income gap. To make his case, the president
cited statistics about the growing percentage of the country’s wealth held by
the top 10 percent (up from one third to one half, he said), a
runaway gap between CEOs and their workers, and the decreasing likelihood that
children born into poverty can escape it in adulthood.
“It should compel us
to action. We are a better country than this,” he said.
He also cited recent
exhortations against rising income inequality by Pope Francis, echoing the
Catholic leader’s question, “How can it be that it is not a news item
when an elderly homeless person dies of exposure, but it is news when the stock
market loses 2 points?”
These trends, the
president argued, are bad for both the economy and for democracy, as the
ordinary people feel like they can no longer participate in government. He also
urged people to move beyond what he called a “myth” that inequality runs only
along racial lines.
The president did not
offer any new policies, but repeated several that he has espoused during his
presidency. He called for government to “relentlessly push a growth agenda,”
including tax reform to close tax loopholes and end incentives to ship jobs
overseas, streamlining regulations that are too costly, making further
investments, and passing a budget for 2014 and undoing the sequester
cuts.
Mr. Obama also
said he would work to improve college affordability, expand the
availability of preschool, protect collective bargaining for unions, and urged
Congress to pass the Paycheck Fairness Act, the Employment Non-Discrimination
Act, and raise the minimum wage.
He stopped short of
identifying a new minimum wage number – “we just want it to be higher,” a White
House official told CBS News,
indicating the president could settle for
something between his $9.00 suggestion made in his 2013 State of the Union
address and a $10.10 wage proposed by Democrats in Congress.
Speaking broadly about
entitlement programs, Mr. Obama said more should be done to help the long-term
unemployed, whose benefits are set
to expire three days after Christmas, and
encourage private saving for retirement.
He had a message for
both parties. Progressives, the president said, “should be open to reforms that
actually strengthen these programs.” And while he defended the Affordable Care
Act as a step to reduce inequality, he told Republicans, “if you still don’t
like Obamacare, and I know you don’t….then you should explain how exactly you’d
cut costs and cover more people and make insurance more secure. You owe it to
the American people to tell us what you are for,” he said.
He took a direct shot
at Sen. Mitch McConnell, R-Ky., who is up for re-election this year, saying the
Senate Minority Leader “might want to check” with 60,000 newly insured
residents of his home state before trying to repeal Obamacare again.
The president restarted
efforts to defend his signature policy achievement, Obamacare, during a speech Tuesday. He built on that defense in his speechWednesday, ticking off a slate of statistics he said
proves the law is already working to benefit Americans: the slow down in the
growth of health care costs, three million young Americans who have been able
to stay on their parents’ health care plans, and more than half a million
people who stand to receive health insurance for the first time next year.
“It is these numbers,
not the ones in any poll, that will ultimately determine the fate of
this law,” he said. “This law’s going to work and for the sake of our economic
security it needs to work,” he said.
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