Town Hall Comes at Critical Time for US Economy, Politics
WASHINGTON—President Obama spoke Monday to a cross-section of Main Street, Wall Street and Washington gathered at a CNBC-sponsored town hall, with the economy at a crossroads and the nation's precarious political structure hanging in the balance.
He defended his administration's record toward business while simultaneously deriding his critics as being politically motivated and saying he would work "setting a better tone" in Washington.
The president spoke just as the National Bureau of Economic Research proclaimed an end to the recession. But Obama acknowledged that times are still tough.
"Obviously for the millions of people still out of work, people who have seen their home values decline, people struggling to pay their home bills every day, it's still very real for them," Obama said.
The "Investing in America" town hall audience also includes college students and union leaders, small business owners and retirees.
With the president and Congress enmeshed in a heated debate about tax policy and a grumpy electorate tossing incumbents aside like rag dolls, the forum provides an opportunity to chart a clearer course for a president whose poll numbers are strikingly low and his party beginning to revolt.
He acknowledged the political issues he faced.
"My life, I'm testimony to the American Dream. Everything I've been doing since I came into office is to make sure that American dream continues for future generations," Obama said. "The challenge now is I'm thinking about the next generation and there are a lot of people out there thinking about the next election."
Faced with a thorny debate over extending tax cuts enacted under former President George W. Bush, the president made his strongest indication yet that the top-tier cuts—for those making more than $250,000 a year—were unlikely to stand when they expire at the end of 2010.
"Here's what I can't do: I can't give tax cuts to the top 2 percent of Americans—86 percent of that money going to people making a million dollars or more—and lower the deficit at the same time. I don't have the math," he said. "At some point in the future if we want to have the discussion about further lowering tax rates, let's do it at the time when we can afford it."
The event is being held at the Newseum, a monument to the First Amendment and a few blocks up Pennsylvania Avenue from the White House.
CNBC chose the site both for its free-speech symbolism and its capacity to handle such events. The network held a similar event last year for Treasury Secretary Timothy Geithner.
Obama faced some testy questions as his battles with Wall Street intensify.
Even as his administration touts a recent agreement for $30 billion in small business loans, critics say his administration has been decidedly anti-business with its new and costly health care reform programs and the uncertainty over whether he will let tax cuts expire at the end of 2010.
But he defended his administration's tack towards businesses, pointing to "eight tax cuts for small businesses" when questioned by an audience member.
And he also cited the government's bailouts of the Big Three auto companies as moves, though initially unpopular, that helped improve the business climate.
"We are now seeing the three US automakers making a profit for the first time in a long time," Obama said. "They are hiring for the first time in a long time, and that has huge ramifications."
A new CNBC poll found that 90 percent of Americans are concerned about the economyand 55 percent feel that repealing tax cuts would be detrimental. The administration and Congress have been having back-and-forth negotiations on whether to continue the cuts, established across-the-board by former president George W. Bush.
While the lower-bracket cuts are less controversial, Congress remains divided over whether to maintain the cuts for those earning more than $250,000 annually.