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The United States was losing more than 700,000 jobs per month when Obama took office. Roughly one month after his inauguration, he signed a stimulus bill that included direct spending for infrastructure, education, health, and energy. The measure also provided federal tax incentives and expanded social welfare provisions, including unemployment benefits.
Obama approved $55 billion for a second round of bailout funding for U.S. automakers GM and Chrysler in March 2009, adding to the $25 billion President George W. Bush signed off on before leaving office. He also appointed a “car czar” who oversaw the post-bankruptcy restructuring of those companies, resulting in management shake-ups, an overhaul of product lines, and large shares of both automakers going to a UAW pension fund.
The U.S. jobs picture has improved in recent years, with the nation experiencing slow but unbroken growth since March 2010. Still, labor force participation remains a deep concern, as the rate has dropped lower this year than any time since Obama took office in 2009 -- and lower overall than any time since 1981.
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Obama on EconomyObama's Statements (1224)
Because I don’t need to tell you we're in tough times right now. We’re still dealing with an economic crisis unlike any that we’ve seen since the Great Depression. It’s done a lot of damage to so many people. And even before that storm hit with its full fury, middle-class families were weathering tough economic times, throughout this past decade, working harder and harder just to keep up. So people are frustrated and they're angry, and they have every right to be. I understand. Because progress is slow, and no matter how much progress we make, it can’t come fast enough for the people who need help right now, today.
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Let me just say, by the way, because you'll hear a lot of stuff about taxes. You always do, every election. Last year, I kept a campaign promise to cut taxes for 95 percent of working Americans. Cut taxes. And these members of Congress right here voted to cut taxes here in the commonwealth not just for individuals, but also for small businesses. We cut taxes for middle-class families. That was part of the Recovery Act. Now, you better check under the hood -- because from everything I see, Martha’s opponent would have voted against those taxes -- he would have voted against those tax cuts. Would have voted against those tax cuts.
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Now, Massachusetts, we have had one year to make up for eight. It hasn’t been quick. It hasn’t been easy. But we've begun to deliver on the change you voted for. I mean, think about it, what some of these members that I just talked about have done, what we've done just over the last several months. We've started to see the economy grow again. We've given tax cuts to small businesses. We're forcing the banks finally to start lending again on Main Street, and not just worried about profits. We've made sure that police officers and teachers and critical workers across this commonwealth haven't been laid off. But we've got so much more work to do. So many families are out there hurting.
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And if you do that, if you do that, if you are willing not only to cast your vote for Martha Coakley, but if you're willing to get out the vote for Martha Coakley -- then you won’t just win this election. You will carry on the best, progressive, forward-looking values of this proud commonwealth and send a leader to Washington who is going to work tirelessly every single day to turn this economy around, to move this country forward, and to keep the American Dream alive in our time and for all time.
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That's exactly what the memorandum I'm issuing today is meant to do. I'm directing my budget office, together with the Treasury Department and other federal agencies, to take steps to block contractors who are seriously delinquent in their taxes from receiving new government contracts. I'm also directing the IRS to conduct a review of the overall accuracy of companies' claims about tax delinquencies. We need to be sure that when a company says it's paying taxes, that company is, in fact, paying taxes.
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And that's why, even as we worked to rescue our broader economy last year, we took some steps to help. We cut taxes, as Joe mentioned, for workers and small businesses. We extended unemployment insurance and health benefits for those who lost their jobs. We provided aid to local governments so you could keep essential services running and keep cops and firefighters and teachers who make your cities safe places to grow and to learn on your payroll.
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Last month, I announced some additional targeted steps to spur private sector hiring and boost small businesses by building on the tax cuts in the Recovery Act and increasing access to the loans they desperately need to grow. I said we'd rebuild and modernize even more of our transportation and communication networks across the country, in addition to the infrastructure projects that are already scheduled to come online this year. I called for the extension of emergency relief to help hurting Americans who've lost their jobs. And you can expect a continued, sustained and relentless effort to create good jobs for the American people. I will not rest until we've gotten there.
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This economic crisis began as a financial crisis, when banks and financial institutions took huge, reckless risks in pursuit of quick profits and massive bonuses. When the dust settled, and this binge of irresponsibility was over, several of the world's oldest and largest financial institutions had collapsed, or were on the verge of doing so. Markets plummeted, credit dried up, and jobs were vanishing by the hundreds of thousands each month. We were on the precipice of a second Great Depression.
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To avoid this calamity, the American people -- who were already struggling in their own right -- were forced to rescue financial firms facing crises largely of their own creation. And that rescue, undertaken by the previous administration, was deeply offensive but it was a necessary thing to do, and it succeeded in stabilizing the financial system and helping to avert that depression.
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Since that time, over the past year, my administration has recovered most of what the federal government provided to banks. And last week, I proposed a fee to be paid by the largest financial firms in order to recover every last dime. But that's not all we have to do. We have to enact common-sense reforms that will protect American taxpayers -– and the American economy -– from future crises as well.
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Now, limits on the risks major financial firms can take are central to the reforms that I've proposed. They are central to the legislation that has passed the House under the leadership of Chairman Barney Frank, and that we're working to pass in the Senate under the leadership of Chairman Chris Dodd. As part of these efforts, today I'm proposing two additional reforms that I believe will strengthen the financial system while preventing future crises.
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First, we should no longer allow banks to stray too far from their central mission of serving their customers. In recent years, too many financial firms have put taxpayer money at risk by operating hedge funds and private equity funds and making riskier investments to reap a quick reward. And these firms have taken these risks while benefiting from special financial privileges that are reserved only for banks.
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But these privileges were not created to bestow banks operating hedge funds or private equity funds with an unfair advantage. When banks benefit from the safety net that taxpayers provide –- which includes lower-cost capital –- it is not appropriate for them to turn around and use that cheap money to trade for profit. And that is especially true when this kind of trading often puts banks in direct conflict with their customers' interests.
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The fact is, these kinds of trading operations can create enormous and costly risks, endangering the entire bank if things go wrong. We simply cannot accept a system in which hedge funds or private equity firms inside banks can place huge, risky bets that are subsidized by taxpayers and that could pose a conflict of interest. And we cannot accept a system in which shareholders make money on these operations if the bank wins but taxpayers foot the bill if the bank loses.
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It's for these reasons that I'm proposing a simple and common-sense reform, which we're calling the "Volcker Rule" -- after this tall guy behind me. Banks will no longer be allowed to own, invest, or sponsor hedge funds, private equity funds, or proprietary trading operations for their own profit, unrelated to serving their customers. If financial firms want to trade for profit, that's something they're free to do. Indeed, doing so –- responsibly –- is a good thing for the markets and the economy. But these firms should not be allowed to run these hedge funds and private equities funds while running a bank backed by the American people.
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My message to members of Congress of both parties is that we have to get this done. And my message to leaders of the financial industry is to work with us, and not against us, on needed reforms. I welcome constructive input from folks in the financial sector. But what we've seen so far, in recent weeks, is an army of industry lobbyists from Wall Street descending on Capitol Hill to try and block basic and common-sense rules of the road that would protect our economy and the American people.
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We've come through a terrible crisis. The American people have paid a very high price. We simply cannot return to business as usual. That's why we're going to ensure that Wall Street pays back the American people for the bailout. That's why we're going to rein in the excess and abuse that nearly brought down our financial system. That's why we're going to pass these reforms into law.
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I knew it would be unpopular -- and rightly so. But I also knew that we had to do it because if they went down, your local banks would have gone down. And if the financial system went down, it would have taken the entire economy and millions more families and businesses with it. We would have looked -- we would have been looking at a second Great Depression.
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So we said, if you're willing to take some tough and painful steps to make yourself more competitive, we're willing to invest in your future. And earlier this week, we heard that the auto industry planned to make almost 3 million cars and trucks here in North America in the next three months, which is up 69 percent from the first three months of last year.
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We also passed a Recovery Act to pull our economy back from the brink. Now, there's been a lot of misunderstanding about this Recovery Act. Sherrod and Marcy and Betty and I were talking about this on the way over here. If you ask the average person, what was the Recovery Act, the stimulus package, they'd say, "the bank bailout." So let me just be clear here: The Recovery Act was cutting taxes for 95 percent of working families -- 15 different tax cuts for working families, seven different tax cuts for small businesses so they can start up and grow and hire. The Recovery Act was extending and increasing unemployment insurance and making COBRA available at a cheaper rate for people who had lost their jobs so they could keep their health care.
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Now, let me tell you why I did it. I knew that insurance premiums had more than doubled in the past decade. I knew that out-of-pocket expenses had skyrocketed. I knew that millions more people had lost their insurance, and I knew that because of that economic crisis that was only going to get worse. When you lose 7 million jobs, like we lost over the last two years, what do you think happens to those folks' health insurance? What happens when their COBRA runs out?
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I took this up because I wanted to ease the burdens on all the families and small businesses that can't afford to pay outrageous rates. And I wanted to protect mothers and fathers and children by being targeted by some of the worst practices of the insurance industry that I had heard time and time again as I traveled through this country.
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So if I was trying to take the path of least resistance, I would have done something a lot easier. But I'm trying to solve the problems that folks here in Ohio and across this country face every day. And I'm not going to walk away just because it's hard. We are going to keep on working to get this done -- with Democrats, I hope with Republicans -- anybody who's willing to step up. Because I'm not going to watch more people get crushed by costs or denied care they need by insurance company bureaucrats. I'm not going to have insurance companies click their heels and watch their stocks skyrocket because once again there's no control on what they do.
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So long as I have some breath in me, so long as I have the privilege of serving as your President, I will not stop fighting for you. I will take my lumps, but I won't stop fighting to bring back jobs here. I won't stop fighting for an economy where hard work is rewarded. I won't stop fighting to make sure there's accountability in our financial system. I'm not going to stop fighting until we have jobs for everybody.
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But it's going to be a fight. You watch. I guarantee you when we start on financial regulatory reform, trying to change the rules to prevent what has caused so much heartache all across the country, there are people who are goIng to say, "Why is he meddling in government -- why is meddling in the financial industry? It's another example of Obama being big government."
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Now, we're not going to make -- I want to be honest. Not all the manufacturing jobs that have gone are going to come back. And if people tell you they are, that's just not true -- because a lot of that has moved to places where the wages are just much lower. And I know that some people say, well, then we should just set up tariffs so that folks can't ship them in. But these days the economy, the global economy is so interconnected that that's just not a practical solution.
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So what we've tried to do is to fill some of these gaps in the meantime. For example, our small business lending through the SBA has actually gone up 70 percent. And we've been waiving fees, increasing guarantees, and what we're trying to do is streamline the process for SBA loans because right now there's just too much paperwork. It's typical government not having caught up with the 21st century. And you can't have a 50-pound application form. People just -- after a while, it's not worth it, in some cases. So we're trying to do all those things.
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So you've got all these insurance reforms that we're trying to get passed. Now, some people ask, well, why don't you just pass that and forget everything else? Here's the problem. Let's just take the example of preexisting conditions. We can't prohibit insurance companies from preventing people with preexisting conditions getting insurance unless everybody essentially has insurance. And the reason for that is otherwise what would happen is people would just -- just wouldn't get insurance until they were sick and then they'd go and buy insurance and they couldn't be prohibited. And that would drive everybody else's premiums up.
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So the second thing we've been trying to do is to make sure that we're setting up an exchange, which is just a big pool so that people who are individuals, who are self employed, who are small business owners, they can essentially join a big pool of millions of people all across the country, which means that when you go to negotiate with your insurance company you've got the purchasing power of a Ford or a GM or Wal-Mart or a Xerox or the federal employees. That's why federal employees have good insurance, and county employees and state employees have good insurance, in part is because they're part of this big pool.
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You asked about Social Security. Let me talk about Medicare. Medicare will be broke in eight years if we do nothing. Right now we give -- we give about $17 billion in subsidies to insurance companies through the Medicare system -- your tax dollars. But when we tried to eliminate them, suddenly there were ads on TV -- "Oh, Obama is trying to cut Medicare." I get all these seniors writing letters: "Why are you trying to cut my Medicare benefits?" I'm not trying to cut your Medicare benefits. I'm trying to stop paying these insurance companies all this money so I can give you a more stable program.
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Well, I wanted to stop by to comment on all the great work that the Middle Class Task Force is doing. And you've just seen why Joe is the right person to do it. No one brings to the table the same combination of personal experience and substantive expertise. He's come a long way, and achieved incredible things along the ride, but he's never forgotten where he came from and his roots as a working-class kid from Scranton. He's devoted his life to making the American Dream a reality for everyone –- because he's lived it.
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Now, we all know what that American Dream is. It's the idea that in America we can make of our lives what we will. It's the idea that if you work hard and live up to your responsibilities, you can get ahead -– and enjoy some of the basic guarantees in life: A good job that pays a good wage, health care that'll be there when you get sick, a secure retirement even if you're not rich, an education that will give our kids a better life than we had. They're very simple ideas. But they're the ideas that are at the heart of our middle class –- the middle class that made the 20th century the American Century.
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For two years, Joe and I traveled this country and we heard stories that are all too familiar: stories of Americans barely able to stay afloat despite working harder and harder for less; premiums that were doubling, tuition fees that were rising almost as fast; savings being used up, retirements put off, dreams put on hold. That was all before the middle class got pounded by the full fury of the worst economic crisis since the Great Depression.
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So we're going to keep fighting to rebuild our economy so that hard work is once again rewarded, wages and incomes are once again rising, and the middle class is once again growing. And above all, we're going to keep fighting to renew the American Dream and keep it alive -- not just in our time, but for all time.
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Today the average debt of a graduating senior from college -- now, listen -- the average debt -- people of my generation -- the average debt is $23,000. That is literally $2,000 more than my first house cost. But in any standard, it's a lot of money -- average debt. Some are graduating with a great deal more debt than that.
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One year ago, I took office amid two wars, an economy rocked by a severe recession, a financial system on the verge of collapse, and a government deeply in debt. Experts from across the political spectrum warned that if we did not act, we might face a second depression. So we acted -– immediately and aggressively. And one year later, the worst of the storm has passed.
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But when I ran for President, I promised I wouldn't just do what was popular -– I would do what was necessary. And if we had allowed the meltdown of the financial system, unemployment might be double what it is today. More businesses would certainly have closed. More homes would have surely been lost.
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Now, let me repeat: We cut taxes. We cut taxes for 95 percent of working families. We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college.
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The plan that has made all of this possible, from the tax cuts to the jobs, is the Recovery Act. That's right -– the Recovery Act, also known as the stimulus bill. Economists on the left and the right say this bill has helped save jobs and avert disaster. But you don't have to take their word for it. Talk to the small business in Phoenix that will triple its workforce because of the Recovery Act. Talk to the window manufacturer in Philadelphia who said he used to be skeptical about the Recovery Act, until he had to add two more work shifts just because of the business it created. Talk to the single teacher raising two kids who was told by her principal in the last week of school that because of the Recovery Act, she wouldn't be laid off after all.
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We should start where most new jobs do –- in small businesses, companies that begin when -- companies that begin when an entrepreneur -- when an entrepreneur takes a chance on a dream, or a worker decides it's time she became her own boss. Through sheer grit and determination, these companies have weathered the recession and they're ready to grow. But when you talk to small businessowners in places like Allentown, Pennsylvania, or Elyria, Ohio, you find out that even though banks on Wall Street are lending again, they're mostly lending to bigger companies. Financing remains difficult for small businessowners across the country, even those that are making a profit.
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So tonight, I'm proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat. I'm also proposing a new small business tax credit
-– one that will go to over one million small businesses who hire new workers or raise wages. While we're at it, let's also eliminate all capital gains taxes on small business investment, and provide a tax incentive for all large businesses and all small businesses to invest in new plants and equipment.
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We can't afford another so-called economic "expansion" like the one from the last decade –- what some call the "lost decade" -– where jobs grew more slowly than during any prior expansion; where the income of the average American household declined while the cost of health care and tuition reached record highs; where prosperity was built on a housing bubble and financial speculation.
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Now, the House has already passed financial reform with many of these changes. And the lobbyists are trying to kill it. But we cannot let them win this fight. And if the bill that ends up on my desk does not meet the test of real reform, I will send it back until we get it right. We've got to get it right.
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I know there have been questions about whether we can afford such changes in a tough economy. I know that there are those who disagree with the overwhelming scientific evidence on climate change. But here's the thing -- even if you doubt the evidence, providing incentives for energy-efficiency and clean energy are the right thing to do for our future -– because the nation that leads the clean energy economy will be the nation that leads the global economy. And America must be that nation.
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Third, we need to export more of our goods. Because the more products we make and sell to other countries, the more jobs we support right here in America. So tonight, we set a new goal: We will double our exports over the next five years, an increase that will support two million jobs in America. To help meet this goal, we're launching a National Export Initiative that will help farmers and small businesses increase their exports, and reform export controls consistent with national security.
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Now, the price of college tuition is just one of the burdens facing the middle class. That's why last year I asked Vice President Biden to chair a task force on middle-class families. That's why we're nearly doubling the child care tax credit, and making it easier to save for retirement by giving access to every worker a retirement account and expanding the tax credit for those who start a nest egg. That's why we're working to lift the value of a family's single largest investment –- their home. The steps we took last year to shore up the housing market have allowed millions of Americans to take out new loans and save an average of $1,500 on mortgage payments.
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After nearly a century of trying -- Democratic administrations, Republican administrations -- we are closer than ever to bringing more security to the lives of so many Americans. The approach we've taken would protect every American from the worst practices of the insurance industry. It would give small businesses and uninsured Americans a chance to choose an affordable health care plan in a competitive market. It would require every insurance plan to cover preventive care.
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And Tampa, like so many communities across our country, has felt the lash of shuttered businesses and lost jobs and home foreclosures and vanished or dwindling savings. And this storm came at the end of what some call a lost decade -- because what happened between 2000 and now, it was a decade in which paychecks shrank and jobs barely grew, and the costs of everything from health care to college education went up. Irresponsibility from Wall Street to Washington left good, responsible Americans who did everything right still struggling in ways they never imagined.
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Joe and I took office in the middle of this raging storm. We ran for office, the highest office, because we had been hearing stories like this day in, day out, for years, even before the financial crisis hit. So we're not going to rest until we rebuild an economy in which hard work and responsibility are rewarded, and businesses are hiring again, and wages are growing again, and the middle class can get its legs underneath it again. We will not rest until we build an economy that's ready for America's future.
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Now, to do that, the first thing we had to do was break the back of this recession. And that required some tough, in some cases unpopular but unnecessary -- all which were necessary steps. I mean -- I mentioned this last night -- none of us wanted to have to stabilize the banking sector, particularly since they helped create this mess. But, as I explained last night, if we hadn't, the financial system literally could have melted down and that would have taken our entire economy and millions more families and businesses with it.
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The true engines of job creation here in America are America's businesses. And there are several steps we can take to help them expand and hire new workers. Last night I proposed taking $30 billion of the money that went to Wall Street banks but have now been repaid and use it to help community banks give small businesses the credit they need to stay afloat. That will help. I also proposed a new tax credit for more than 1 million small businesses that hire new workers or raise wages. And while we're at it, I believe that we should eliminate all capital gains taxes on small business investment, and provide a tax incentive for all businesses to invest in new plants and equipment.
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We won't stop fighting to spark innovation and ignite a clean energy economy where America's workers are building solar panels and wind towers and cutting-edge batteries for automobiles -- because the nation that leads the clean energy revolution will be the nation that leads the global economy. And, as I said last night, other countries aren't waiting. They want those jobs. China wants those jobs. Germany wants those jobs. They are going after them hard, making the investments required.
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I just want to be clear here, for the benefit of my friends in the back. We need a strong financial sector. Without it, businesses can't get capital to grow and create jobs. Families can't finance a home loan or education. So we want a healthy financial sector. And there are folks all across the country working in banks who are doing great service to their community. But we also need some rules of the road for Wall Street, so that reckless decisions made by a few don't take our economy over the side. That's common sense. There's nothing radical about that. In fact, the banks should want it because it would create greater stability in the system.
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And, yes, we will not stop fighting for a health care system that works for the American people, not just for the insurance industry. We won't stop. We want a system where you can't be denied care if you have a preexisting condition. You can't get thrown off your insurance right at the time when you get seriously ill. We want a system where small businesses can get insurance at a price they can afford.
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Nobody pays more than small businesses and individuals who are self-employed in the insurance market, because they've got no leverage. We want to change that by allowing them to be able to set up a pool. We want to make sure that people who don't have coverage can find an affordable choice in a competitive marketplace. We want a system in which seniors don't have these huge gaps in their Medicare prescription drug coverage -- and where Medicare itself is on a sounder financial footing. Those are the things that we're fighting for.
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So that, you know, "you lose, I win" mentality, that mindset may be good for short-term politics, but it's not a mindset that's equal to these times. It's not worthy of you. What you deserve is for all of us, Democrats and Republicans, to work through our differences, overcome our politics, do what is hard, do what is necessary to advance the American Dream and keep it alive for our time and for all time.
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Well, this is a good question. Look, first of all, you should be aware that we have increased SBA loans during the course of this year by 70 percent in some cases. So some of the key programs for businesses like yours we have massively increased their lending. And by the way, we've waived some of the fees and red tape that are associated with you getting a loan from the SBA.
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Keep in mind, a small business loan of any sort, or a large business loan of any sort requires some sense of, all right, what's the business plan, what are your projected earnings, et cetera, et cetera. And somebody has got to do that. Now, if the SBA were to suddenly take over that entire function we'd have to stand up a massive bureaucracy -- a huge one. And we'd have to train all those people and it would take too long, and you'd be frustrated -- why is it that this big government agency can't seem to run anything?
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Look, let me take the example of health care. Part of the reason why it's so easy to scare people about health care, even if they don't like it the way it is now, is because you've got doctors, you've got nurses, you've got hospitals, you've got insurance systems, you've got Medicaid, you've got Medicare, you've got the VA system -- all these systems constitute several trillion dollars, one-sixth of our economy. Even if you come up with a great plan that lowers premiums and creates greater competition and ensures freedom for you to choose your doctor and is bringing down the deficit -- all the things that I've claimed -- and prevents insurance companies from abusing customers -- even if we do all that, there's going to be somebody out there in a $2 trillion system who's unhappy with something. Right?
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And the fact is we're standing in a very different place than we were just a year ago. Just last year, businesses were cutting 700,000 jobs per month. The markets were plummeting. Many people feared another Great Depression. Today, we've stopped the flood of job losses, we've stabilized the financial system, and we can safely say that we've avoided that looming depression.
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We cut taxes for college students and first-time homebuyers and small businesses. We made health insurance cheaper through COBRA. So some of you know friends or family members who've lost their jobs but they kept their health insurance because COBRA was 65 percent cheaper than it would have otherwise been. And we extended unemployment insurance for folks who have lost their jobs, including more than 200,000 people here in Maryland. We've created and saved 2 million jobs. That's 2 million teachers and firefighters, police officers, builders, manufacturing workers, and others who are on the job today because of some of the steps that we took.
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Now, even though the storms of the past two years are starting to lessen, the wreckage that's been left behind remains. While the Recovery Act has created and saved 2 million jobs, this recession has cost us 7 million jobs. So there's still a big gap -- still a big hole that we have to fill. And it represents a terrible human tragedy, as families are thrown into hardship and uncertainty. But the good news is, today's report means that we're increasing GDP, we're increasing economic growth. That means businesses are going to start to see more customers, and hopefully even here at Chesapeake you might start seeing enough orders that you start needing to hire that extra shift. That could make a big difference.
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Today, I'm proposing what I believe is the best way to cut taxes while promoting hiring by small businesses: through a tax credit for companies that add workers or increase salaries this year. Now is the perfect time for this kind of incentive because the economy is growing, but businesses are still hesitant to start hiring again. The economy is growing, but job growth is lagging. Companies are recovering but not yet taking that next step and taking on somebody full time. And while businesses will always be the engines of job creation in this country, government can create the conditions for those businesses to expand and hire more workers.
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So this is a simple, easy to understand mechanism that will cut taxes for more than 1 million small businesses. It'll give them an incentive to hire more people and a little bit of extra money to pay higher wages, to expand work hours, or invest in their company. And in order to get this incentive working quickly, employers would actually be able to receive this money every quarter, as opposed to waiting a whole year to see it benefit their taxes. So the Chesapeake Machine Company is a perfect example. I understand, Terry, that you may be thinking about hiring a couple of new workers this year. Well, this tax credit could help you do it and it would mean $5,000 per worker that you hire.
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Now, it's true that in some instances this tax credit will go to businesses that were going to hire folks anyway. But then, it simply becomes a tax cut for small businesses that will spur investment and expansion. And that's a good thing, too. And that's why this type of tax cut is considered by economists -- who rarely agree on anything -- to be one of the most cost-effective ways of accelerating job growth, especially because we will include provisions to prevent people from gaming the system. So, for example, you won't get a tax credit for doubling your workforce while cutting the hours of each worker in half. We're not going to let you game the system to take advantage of the tax credit, unless you're doing right by your workers.
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All of this is going to create jobs in the short term, while helping our economy in the long run. And I've proposed taking some of the money that went to the big banks on Wall Street to help bolster the financial system and give it to smaller community banks that lend to small businesses like Chesapeake, because too many companies that I'm seeing out there still can't find affordable credit.
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The House of Representatives has passed a jobs bill that includes some of these proposals. I expect the Senate to do the same. I'm open to any good ideas from Democrats or Republicans. In fact, several members of Congress have proposed tax breaks for businesses similar to what I've proposed, and I'm looking forward to working with them. The key thing is it's time to put America back to work.
We've had two very tough years. And while these proposals will create jobs all across America, we've got a long way to go to make up for the millions of jobs that we lost in this recession. And I don’t have to tell folks in Baltimore that even before this recession hit, the middle class was facing real hardships: stagnant incomes, rising costs, growing economic security [sic]. So rebuilding this economy and rebuilding -- and rebuilding it stronger than before -- will take time and it's going to take hard work and vigilance.
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In good times and bad, through storms and still waters, men like you have gotten up and women like you have gotten up and gone to work and put in long days and headed home. You're a little tired, but you're glad for the opportunity to make a living, while helping this country become the most productive, innovative economy in the world. Small businesses have powered our economy in the past. They are fostering our recovery today. I have no doubt if we support you that small businesses like this one will lead us to more prosperous days ahead.
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So we have a track record of working together. It is possible. But, as John, you mentioned, on some very big things, we've seen party-line votes that, I'm just going to be honest, were disappointing. Let's start with our efforts to jumpstart the economy last winter, when we were losing 700,000 jobs a month. Our financial system teetered on the brink of collapse and the threat of a second Great Depression loomed large. I didn't understand then, and I still don't understand, why we got opposition in this caucus for almost $300 billion in badly needed tax cuts for the American people, or COBRA coverage to help Americans who've lost jobs in this recession to keep the health insurance that they desperately needed, or opposition to putting Americans to work laying broadband and rebuilding roads and bridges and breaking ground on new construction projects.
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So, today, in line with what I stated at the State of the Union, I've proposed a new jobs tax credit for small business. And here's how it would work. Employers would get a tax credit of up to $5,000 for every employee they add in 2010. They'd get a tax break for increases in wages, as well. So, if you raise wages for employees making under $100,000, we'd refund part of your payroll tax for every dollar you increase those wages faster than inflation. It's a simple concept. It's easy to understand. It would cut taxes for more than 1 million small businesses.
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So I hope you join me. Let's get this done. I want to eliminate the capital gains tax for small business investment, and take some of the bailout money the Wall Street banks have returned and use it to help community banks start lending to small businesses again. So join me. I am confident that we can do this together for the American people. And there's nothing in that proposal that runs contrary to the ideological predispositions of this caucus. The question is: What's going to keep us from getting this done?
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I've proposed a modest fee on the nation's largest banks and financial institutions to fully recover for taxpayers' money that they provided to the financial sector when it was teetering on the brink of collapse. And it's designed to discourage them from taking reckless risks in the future. If you listen to the American people, John, they'll tell you they want their money back. Let's do this together, Republicans and Democrats.
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A number of you have suggested creating pools where self-employed and small businesses could buy insurance. That was a good idea. I embraced it. Some of you supported efforts to provide insurance to children and let kids remain covered on their parents' insurance until they're 25 or 26. I supported that. That's part of our package. I supported a number of other ideas, from incentivizing wellness to creating an affordable catastrophic insurance option for young people that came from Republicans like Mike Enzi and Olympia Snowe in the Senate, and I'm sure from some of you as well. So when you say I ought to be willing to accept Republican ideas on health care, let's be clear: I have.
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So I mean, I think we can score political points on the basis of the fact that we underestimated how severe the job losses were going to be. But those job losses took place before any stimulus, whether it was the ones that you guys have proposed or the ones that we proposed, could have ever taken into effect. Now, that's just the fact, Mike, and I don't think anybody would dispute that. You could not find an economist who would dispute that.
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The package that we put together at the beginning of the year, the truth is, should have reflected -- and I believe reflected what most of you would say are common sense things. This notion that this was a radical package is just not true. A third of them were tax cuts, and they weren't -- when you say they were "boutique" tax cuts, Mike, 95 percent of working Americans got tax cuts, small businesses got tax cuts, large businesses got help in terms of their depreciation schedules. I mean, it was a pretty conventional list of tax cuts. A third of it was stabilizing state budgets.
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Now, we can -- here's what I know going forward, though. I mean, we're talking -- we were talking about the past. We can talk about this going forward. I have looked at every idea out there in terms of accelerating job growth to match the economic growth that's already taken place. The jobs credit that I'm discussing right now is one that a lot of people think would be the most cost-effective way for encouraging people to pick up their hiring.
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Here's what I'm going to do, Mike. What I'm going to do is I'm going to take a look at what you guys are proposing. And the reason I say this, before you say, "Okay," I think is important to know -- what you may consider across-the-board tax cuts could be, for example, greater tax cuts for people who are making a billion dollars. I may not agree to a tax cut for Warren Buffet. You may be calling for an across-the-board tax cut for the banking industry right now. I may not agree to that.
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With respect to earmarks, we didn't have earmarks in the Recovery Act. We didn't get a lot of credit for it, but there were no earmarks in that. I was confronted at the beginning of my term with an omnibus package that did have a lot of earmarks from Republicans and Democrats, and a lot of people in this chamber. And the question was whether I was going to have a big budget fight, at a time when I was still trying to figure out whether or not the financial system was melting down and we had to make a whole bunch of emergency decisions about the economy. So what I said was let's keep them to a minimum, but I couldn't excise them all.
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I think one of the proposals that has been focused on by the Republicans as a way to reduce costs is allowing insurance companies to sell across state lines. We actually include that as part of our approach. But the caveat is, we've got to do so with some minimum standards, because otherwise what happens is that you could have insurance companies circumvent a whole bunch of state regulations about basic benefits or what have you, making sure that a woman is able to get mammograms as part of preventive care, for example. Part of what could happen is insurance companies could go into states and cherry-pick and just get those who are healthiest and leave behind those who are least healthy, which would raise everybody's premiums who weren't healthy, right?
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It's not enough if you say, for example, that we've offered a health care plan and I look up -- this is just under the section that you've just provided me, or the book that you just provided me -- summary of GOP health care reform bill: The GOP plan will lower health care premiums for American families and small businesses, addressing America's number-one priority for health reform. I mean, that's an idea that we all embrace. But specifically it's got to work. I mean, there's got to be a mechanism in these plans that I can go to an independent health care expert and say, is this something that will actually work, or is it boilerplate?
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You may not support our overall jobs package, but if you look at the tax credit that we're proposing for small businesses right now, it is consistent with a lot of what you guys have said in the past. And just the fact that it's my administration that's proposing it shouldn't prevent you from supporting it. That's my point.
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Now, I just want to point out -- and this brings me to the second problem -- when we made a very modest proposal as part of our package, our health care reform package, to eliminate the subsidies going to insurance companies for Medicare Advantage, we were attacked across the board, by many on your aisle, for slashing Medicare. You remember? We're going to start cutting benefits for seniors. That was the story that was perpetrated out there -- scared the dickens out of a lot of seniors.
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One year later, thanks largely to the Recovery Act, we can stand here again and say that a second depression is no longer a possibility. An economy that was shrinking by 6 percent a year ago is now growing by nearly 6 percent. According to independent, nonpartisan economists, there are about 2 million Americans who are at work today who would otherwise be unemployed.
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The reform before Congress that people like Michael and myself have been working on would help prevent such hikes from happening. And if we walk away from it, we know that premiums and out-of-pocket expenses will keep rising this decade, just as they did in the last decade. More small businesses are going to be priced out of the insurance market. More business -- more big businesses are going to be unable to compete internationally. More of you will see health care taking a bigger and bigger bite out of your paychecks. Millions will lose their coverage. Our deficits will keep on growing because health care costs, by far, is the biggest driver of deficits.
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Now, there are those who suggest that the only way government can promote strong markets is to allow them to operate wholly outside even the most modest rules of the road, even the most sensible reforms. Many of these same folks also suggest -- whether in regard to proposed consumer protections in the health insurance industry, or proposed rules to prevent another financial crisis -- that these kinds of policies run counter to our economic interests. And while I respect those who sincerely hold this view, the facts -- and our history -- do not favor this argument.
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We passed tax relief for small businesses and 95 percent of working families, for college students, for first-time homebuyers. We extended or increased unemployment benefits not just to help those families but also to make sure that there was some demand in the economy at a time when so much demand had been lost. We made health insurance 65 percent cheaper for families relying on COBRA. We acted to close state budget gaps to prevent hundreds of thousands of teachers and public school workers and firefighters and police officers from being laid off all across the country, including right here in Nevada.
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So that's why Harry and I are working to provide tax breaks for small businesses to spur hiring. That's why we're fighting for health insurance reforms to address the crushing cost of health insurance for small businesses and families. And that's why we've continued to seek ways to address the home mortgage crisis, which has touched all parts of this country, but has hit Las Vegas particularly hard.
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Now, government has a responsibility to help deal with this problem. I've got to again repeat -- government can't stop every foreclosure. There's not enough money in the Treasury to stop every foreclosure. And we shouldn't be using tax dollars to reward the same irresponsible lenders or borrowers who helped precipitate the crisis. But what government can do -- what government can do is to help responsible homeowners to stay in their homes. The government can stop preventable foreclosures. What we can do is stabilize the housing market so home values can begin to rise again.
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So over the course of the past year, we've taken a number of steps to do just that. We've provided a tax credit for 1.4 million taxpayers to help them buy their first homes. We've made it possible for more than one million struggling homeowners to reduce monthly payments. And combined with our broader efforts to spur growth, stem job losses, and stabilize the financial system, we've helped promote recovery in the housing markets. In fact, in many markets, home values have begun to rebound.
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But we got a ways to go, especially in the hardest hit regions like Las Vegas, where there are just too many blocks littered with brown lawns and "for sale" signs, too many mortgage holders are underwater, and where job losses continue to exact a terrible toll. So for these communities, recovery depends on continued responsible efforts to stop the downward spiral of defaults, foreclosures, and declining home values.
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That's why earlier today I announced a $1.5 billion investment in housing finance agencies in the states hardest hit by this housing crisis. And one of those states is Nevada. So that means that here in Nevada, we're going to be able to help prevent some foreclosures that otherwise would have happened. It's going to allow lenders to help homeowners who are underwater. And it will help folks who've taken out a second mortgage modify their loans.
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Now, these are very difficult times for our country -- times that demand we put aside the stale debates and the tired arguments, times that demand of us something more. The fact is, the economic crisis of the past two years -- indeed the growing economic insecurity of the middle class that's been going for a decade -- was born not just of failures in our economic system. These challenges were also born of failures in our political system.
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And it's got to stop, because the challenges have been mounting all around us. A health care system that saddles businesses and families with skyrocketing costs. An economy powered by fuels -- are fuels of the 20th century instead of the 21st, and endanger our planet and our security. We've got an education system unsuited for a global era, and a financial system that has been rewarding reckless risks. And we've got a structural deficit that threatens to leave our children a mountain of debt.
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So we've seen the consequences of this failure of responsibility, and the American people have paid a heavy price. The question we'll have to answer now is if we're going to learn from the past or if, even in the aftermath of disaster, we're going to repeat it. Because as the alarm bells fade, and the din of Washington rises, the danger is we just forget what happened and we start thinking we should go back to business as usual. That won't work. It will not work in this global economy, not in this environment.
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If businesses -- and nobody understands that more than Las Vegas. If the MGM is doing well, that means its workers are doing well. And if its workers are doing well, that means that the housing market is doing well. And if the housing market is doing well, then that means that small businesses all across the region are doing well, who in turn are hiring more workers.
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You don't need me to tell you that. All of you in some way have felt this recession. You felt it in the tourism and hospitality industry. You felt it in the construction industry. The unemployment rate here is 13 percent, which is the second highest in the nation. Foreclosures are also among the highest. Home values have fallen by more than almost anyplace else. And this is after a decade when, for most middle-class families, incomes actually shrank and wages flat-lined, and the only thing rising faster was medical costs and the cost of education.
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When my administration took office, our immediate mission was clear. We needed to stop the great recession from turning into a great depression. And economists of every stripe were warning that was a real possibility. And that meant that we had to make some decisions swiftly, boldly, and not always popular, but decisions that were necessary. It wasn't a time for satisfying the politics of the moment, it wasn't time for just playing to the cameras -- it was time for doing what was right.
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And by the way, I was committed to ensuring that if taxpayers were going to provide temporary assistance to keep our financial system afloat, then it actually had to be temporary. And I was determined to get back every single dime, and we are well on our way to doing that -- getting back every single dime from those banks.
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We helped shore up the American auto industry. That wasn't popular. I understood why. Folks felt like these companies should reap the consequences of bad management decisions in the past, just like any other company would. But if we had let GM and Chrysler go under, it would have been hundreds of thousands of hardworking Americans who paid the price -- not just folks at those companies themselves, but at suppliers and dealers all across the country.
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So it's also why we passed the Recovery Act. Now, a lot of people think that the stimulus package, the Recovery Act -- if you listen on television, you'd think, well, that's all about giving banks money. That has nothing to do with the banks. The other week, I saw a poll that said Americans, they don't like the Recovery Act -- they just like all the individual parts of the Recovery Act.
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And the reason is, they think the Recovery Act is for banks and auto companies. When you ask folks about what was actually in the Recovery Act, they think it's full of good ideas -- like tax cuts, like infrastructure investment, like unemployment relief. That's what the Recovery Act was. It was tax cuts for small business owners and 95 percent of you. You may not have noticed -- 95 percent of you got a tax cut -- because of Harry Reid and because of the Recovery Act. One million people in the state of Nevada.
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Now, I've said before that the way I measure our economy's strength -- the way you measure it -- is by whether jobs and wages and incomes are growing. But the other way we measure is by whether families have a roof over their heads and whether folks are living out that American Dream of owning a home. That dream has been jeopardized in this recession for a lot of people, especially right here in Nevada.
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Now, part of it was -- I've got to be blunt here, I got to be honest -- part of it was because too many lenders were focused on making a quick buck instead of acting responsibly. And, if we're honest, too many borrowers acted irresponsibly at certain points, taking on mortgages that they knew they couldn't afford. And what happened was the regulators in Washington and legislators too often turned a blind eye to the excesses and the failures on Wall Street that fed a housing bubble. And now that that bubble has burst, it's left devastation that we're still grappling with today.
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Now, government has a responsibility to help deal with this problem. Government can't solve this problem alone. We got to be honest about that. Government alone can't solve this problem. And it shouldn't. But government can make a difference. It can't stop every foreclosure, and tax dollars shouldn't be used to reward the very irresponsible lenders and borrowers who helped bring about the housing crisis. But what we can do is help families who've done everything right stay in their homes whenever possible. What we can do is stabilize the housing market so that home values can begin rising again.
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And that's why we're buying up vacant homes and converting them into affordable housing -- creating jobs, stemming our housing crisis, growing the local economy. That's why last year, we put a tax credit worth thousands of dollars into the pocket of 1.4 million Americans to help them buy their first home -- first-time homebuyers credit. That's why we're offering over one million struggling homeowners lower monthly payments through our loan modification initiative.
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So this fund is going to help out-of-work homeowners avoid preventable foreclosures, and it will help homeowners who owe more than their homes are worth find a way to pay their mortgages that works for both the borrowers and the lenders alike, and will help folks who've taken out a second mortgage modify their loans.
So, yes, we need to strengthen our housing market. And we need to focus on job creation and getting our economy moving again. But one last thing I want to be clear about -- we can do all those things, dealing with sort of the emergency crisis, and still fall behind in the 21st century, in this global economy, unless we recommit ourselves to solving some of the long-term problems that have been with us for years.
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Because America can't solve our economic problems unless we tackle some of these structural problems. And America can't lead -- we can't succeed unless we're also getting a handle on our debt. We've got to confront this fiscal crisis that has been brewing for years. That's why we're cutting what we don't need to pay for what we do. That's why I signed a law that says Americans should pay as we go and live within our means. That's why yesterday I announced a bipartisan fiscal commission that will help us meet our fiscal challenges once and for all.
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I mean, that was the warning. Plus, because the economy is bad, a lot of people are already feeling kind of anxious, and so they're thinking, gosh, we had to do all that stuff to fix the financial system, we had to do this stuff to fix the autos, we had this big recovery package, the deficits are going up -- partly because tax revenues is not coming in and we're having to spend more on unemployment insurance and things like that -- this is probably not the time to be too ambitious.
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Number two, we've got a whole series of cost controls. So what we're saying is, for example, that every insurer, they've got to spend the vast majority of your premiums on actual care, as opposed to profits and overhead. We're saying that we've got to get out some of the waste and abuse, including subsidies to insurance companies in the Medicare system that run in the tens of billions of dollars every year. That's not a good use of your taxpayer dollars. And we're working to improve wellness and prevention, as I said before, so that people aren't going to the emergency room for care.
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Now, the third thing, and the thing that's most controversial, sadly, is what we're also saying is we've got to make sure that everybody can have access to coverage. And the way we do that is we set up something called an exchange, where essentially individuals and small businesses who aren't getting a good deal because they don't have the same negotiating power as the big companies when it comes to the insurance market, they can pool just like members of Congress and federal employees do in their health care plan -- they can pool so that now they've got the purchasing power of a million people behind them and they can get a better deal. That can lower their costs. And we'll give subsidies for working families who can't afford it even with lower premium costs.
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Now, if you were listening to the Republicans, you'd think that last year we weren't paying any attention to jobs, that we were just kind of -- I don't know what we were doing, Harry. I guess we were just sort of sitting around. The truth is, is that everything we did last year was designed around how do we break the back of the recession and move the economic recovery forward in order to promote job growth.
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You can't have job growth if the economy is contracting by 6 percent, because businesses look and they say nobody is spending money, we got no customers, we can't hire. So the first thing we had to do was to make sure that companies were starting to make a profit again, and the economy was growing. We are now in that position, because of the work that Harry did and a lot of -- and these two outstanding members of Congress did, Congresswoman Berkley and Titus. The economy is now growing again.
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So we're going to be putting -- Harry and I are working now on a jobs package for this year that's designed not -- it's no longer designed to grow the economy. Now it's designed to give incentives to businesses who are now making a profit to start hiring again, and to help small businesses get loans. Because a lot of small businesses are still having trouble getting loans from banks, even if they see an opportunity for business growth, and we want to make sure that they've got access to capital.
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Well, how about that? Let me -- let me -- before you ask your actual question, let me just make this point. We're not actually eliminating Medicare Advantage. What Medicare Advantage is, is basically the previous administration had this idea, instead of traditional Medicare, let's contract out to insurance companies to manage the Medicare program. And the insurance companies can then kind of package and pool providers of dental care or eye wear or what have you, and it's a one-stop shop for seniors.
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Now, in theory that sounds like a pretty good idea, except as you might imagine if the insurance companies are involved that means they've got to make a profit. And what happened was they didn't bid out competitively this Medicare Advantage program. So these insurance companies were just getting a sweet deal.
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Q Thank you, . My name is Dr. Herve Misoko (phonetic). I am originally from France -- actually from Africa, moved to France, and now I'm here in America because I believe -- I still believe that America is the country of the American Dream. And I came here -- I'm a scientist, president of a renewable energy startup, and I came here because I really believe that America can become the first country for clean energy.
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Okay. Well, let me just talk about -- this is -- when the conservatives have their conventions and they yell at me and say how terrible I am -- along with health care this is the other thing that they usually point out, which is that "the President wants to create this cap and trade system and it's going to be a job killer and it's one more step in the government takeover of the American economy." So this is a good place for me to maybe just spend a little time talking about energy and climate change.
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All right, now, back to what I was saying. You know, obviously we know that the country is going through a tough time. But when I was here a year ago, at Mile High, and some of you were probably here -- some of you were there with me -- I made a promise to you not that I was going to tell you what you wanted to hear, not that I was always going to do what was popular. But I promised you that I would wake up each and every day thinking about how we can make sure that the American Dream is working for everybody, and more importantly, how we can make sure that it's working for the next generation.
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And that was just a few days before I signed the Recovery Act into law -- a plan that many of you were instrumental in devising. That plan cut taxes for small businesses and for 95 percent of working Americans. It gave direct relief to those hardest hit by the recession, including workers who lost their jobs and families who lost their health care because of it. It helped most of you close some of those budget gaps that had developed, which kept 300,000 teachers and education workers in your schools and tens of thousands of first responders on your streets.
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Overall, the economy is in a better place than it was a year ago. We were contracting by 6 percent and we're now growing by 6 percent. But I know that your states are still in a very tough situation, and too many Americans still haven't felt the recovery in their own lives. So we're working to create jobs by all means necessary, be it by cutting taxes for small businesses that create them, to investing more in infrastructure and in energy efficiency, or giving you more help to close budget shortfalls. And I am not going to rest until we see more progress in each and every one of your states.
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My grandpop used to have an expression -- a couple of you heard me say -- when the guy -- he was from Scranton -- when the guy in Oliphant's is out of work it's an economic slowdown -- that's a little town outside of Scranton. When your brother-in-law is out of work it's a recession. When you're out of work it's a depression. It's a depression for a lot of Americans. You all are right on the front lines trying to deal with the concerns and problems of those people.
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Over the last year, we’ve worked together on a number of issues –- from economic recovery and tax policy to education and to health care. And more often than not, we’ve found common ground. This is important, because we meet at a time, as all of you are aware, a time of great economic anxiety and sharp political divisions. We’re still emerging from the worst economic crisis since the Great Depression. Eight million Americans have lost their jobs over the last two years. Home values in too many parts of the country have plummeted. And too many businesses are still reluctant to invest and expand.
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It’s no wonder, then, that people are frustrated. They’re frustrated with government and they’re frustrated with business. They’re angry at a financial sector that took exorbitant risks by some in pursuit of short-term profits, and they’re angry at a government that failed to catch the problem on time. They’re angry at the price they paid to prevent a financial meltdown that they didn’t cause, and they’re angry that recovery in their own lives seems to be lagging the recovery of bank profitability. They’re angry at the lobbyists who use their influence to put their clients’ special interests ahead of the public interest. And although both parties are predictably scrambling to align themselves with people’s frustrations, neither the usual answers from the left or the right seem to be inspiring much confidence.
So we’ve got some big challenges ahead. And I think all of us know that we can’t meet them by returning to the pre-crisis status quo -– an economy that was too dependent on a housing bubble, on consumer debt, on financial speculation, and on growing deficits. That’s not sustainable for American workers, and it’s not sustainable for American businesses.
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Now, contrary to the claims of some of my critics and some of the editorial pages, I am an ardent believer in the free market. I believe businesses like yours are the engines of economic growth in this country. You create jobs. You develop new products and cutting-edge technologies. And you create the supply chains that make it possible for small businesses to open their doors. So I want everyone in this room to succeed. I want your shareholders to do well, I want your workers to do well, I want you to do well -- because I firmly believe that America’s success in large part depends on your success internationally.
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If we don't pass financial reform, we can expect more crises in the future of the sort that we just saw. On the other hand, if we design the new rules carelessly, they could choke off the supply of capital to businesses and families. If we allow our safety net to be weakened, or lose a sense of fairness in our tax code, then we can expect more anger and frustration from citizens across the political spectrum. And at the same time, if an exploding entitlement state is gobbling up more and more of our tax dollars, there's no way we'll retain our competitive edge.
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Now, our first and most immediate task is to complete the economic recovery by taking additional steps to bolster demand and keep credit flowing. Along with our efforts to unfreeze credit and stabilize the housing market, the Recovery Act helped to do this, and it's one of the main reasons our economy has gone from shrinking by 6 percent to growing by nearly 6 percent.
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But we need to do more. We should make it easier for small businesses to get loans, and give them a tax credit for hiring new workers or raising wages. We should invest in infrastructure projects that lead to new jobs in the construction industry and other hard-hit businesses. And we should provide a tax incentive for large businesses like yours to invest in new plants and equipment. That would make a difference now.
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One year ago, we were looking at the possible end of General Motors. Today, GM has increased production, is paying us back ahead of schedule. Yesterday, we learned they're hiring 1,200 more workers in their Lordstown, Ohio plant. One year ago, there was a chance we would lose most of the $700 billion we were given to rescue the financial system. Today, most of that money has been repaid. The financial fee we’ve proposed would recover the rest and close the books on government’s involvement.
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And let me say a word about compensation here. Most Americans -- including myself -- do not begrudge reasonable rewards for a job well done. What's outraged people are outsized bonuses at firms that so recently required massive public assistance. Once that money is fully repaid, I don’t believe it’s appropriate for the government to be in the business of setting compensation levels. I do believe that shareholders should have a say in compensation packages given to top executives, and that those packages should be based on long-term performance instead of short-term profits. And I think that's particularly important in the financial industry, where reckless risks in pursuit of short-term gain helped create a crisis that engulfed the world economy.
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But here's the larger point that I'm trying to make. The steps we took last year were about saving the economy from collapse, not about expanding government's reach into the economy. The jobs bill working through Congress right now are similarly designed to be targeted and temporary. And I'm pleased that a few hours ago the Senate just passed a series of tax cuts for small businesses that hire more workers. This is an important step forward in putting more Americans back to work as soon as possible.
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That's why, in the State of the Union, I set a goal of doubling our exports over the next five years, an increase that will support 2 million jobs. And to help me meet this goal, Gary Locke recently announced that we're launching a National Export Initiative where the federal government will significantly ramp up its advocacy on behalf of U.S. exporters. We're substantially expanding the trade financing available to exporters, including small and medium-sized companies. And while always keeping our security needs in mind, we're going to reform our export controls to eliminate unnecessary barriers. So some of the sectors where we have a huge competitive advantage in high-tech areas, we're going to be able to send more of those products to markets overseas. And we're going to pursue a more strategic and aggressive effort to open up new markets for our goods.
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Now, I know that trade policy has been one of those longstanding divides between business and labor, between Democrats and Republicans. To those who would reflexively support every and any trade deal, I would say that our competitors have to play fair and our agreements have to be enforced. We can't simply cede more jobs or markets to unfair trade practices. At the same time, to those who would reflexively oppose every trade agreement, they need to know that if America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores. In other countries, whether China or Germany or Brazil, they've been able to align the interests of business, workers, and government around trade agreements that open up new markets for them and create new jobs for them. We must do the same. And I'm committed to making that happen.
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Right now we have a financial system with the same vulnerabilities that it had before this crisis began. And as I said in the State of the Union, my goal is not to punish Wall Street. I believe that most individuals in the financial sector are looking to make money in an honest and transparent way. But if there aren't rules in place to guard against the recklessness of a few, and they're allowed to exploit consumers and take on excessive risk, it starts a race to the bottom that results in all of us losing.
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And that's what we need to change. We can't repeat the mistakes of the past. We can't allow another AIG or another Lehman to happen again. We can't allow financial institutions, including those that take your deposits, to make gambles that threaten the whole economy. What does that mean? It means we've got to ensure consolidated supervision of all institutions that could pose a risk to the system. It means we have to close loopholes that allow financial firms to evade oversight and circumvent rules of the road. It means that we need more robust consumer and investor protections.
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But let's look at the truth, because the truth is just the opposite. We have not called for the elimination of private insurance. We have not -- we've been extraordinarily careful not to in any way undermine the employer-based system. What we’ve called for is an insurance exchange where individuals and small businesses can pool together in order to get a better deal from their insurance companies. In return for getting more customers, we would require insurance companies not to discriminate on the basis of preexisting conditions or arbitrarily jack up premiums.
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During the campaign, I promised a tax cut for 95 percent of working Americans. I kept that promise. We've provided over $150 billion in tax cuts to small businesses and to families. We haven't raised anybody's income taxes by a single dime. This year, I expect to sign into law another $70 billion worth of business tax cuts for 2010 and 2011 -– a more than 10 percent cut in corporate taxes. Now, that may not jibe with what you're hearing or what you're reading, but those are the facts. They're indisputable.
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I hear from small businesses who have just opened up their new rates from their insurance company and it turns out that the rates have gone up 20, 30, in some cases 35 percent. I hear from families who have hit lifetime limits and because somebody in their family is very ill, at a certain point they start having to dig out of pocket and they are having to mortgage their house and in some cases have gone bankrupt because of health care.
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My mother, who was self-employed, didn't have reliable health care, and she died of ovarian cancer. And there's probably nothing that modern medicine could have done about that. It was caught late, and that's a hard cancer to diagnose. But I do remember the last six months of her life -- insurance companies threatening that they would not reimburse her for her costs, and her having to be on the phone in the hospital room arguing with insurance companies when what she should have been doing is spending time with her family. I do remember that.
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You know, I was looking through some of the past statements that people have made, and I think this concern is bipartisan. John McCain has talked about how rising health care costs are devastating to middle-class families. Chuck, you've been working on this a long time. You've discussed the unsustainable growth in Medicare and Medicaid in our budget. Mike Enzi, who's worked on this and partnered with Ted Kennedy on a range of health care issues as a chairman of the committee, you said that small businesses in your home state are finding it nearly impossible to afford health care coverage for their employees. And you said that the current system is in critical condition. And Mitch, you've said that the need for reform is not in question, and obviously there are comparable studies on the Democratic side as well.
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I've looked very carefully at John Boehner's plan that he put forward. I've looked at Tom Coburn and Senator Burr's plan that's been put out there. Paul Ryan has discussed some of the issues surrounding Medicare. I've looked at those very carefully. Mike Enzi, in the past you've put forward legislation around small businesses that are very important.
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The basic concept is that we would set up an exchange, meaning a place where individuals and small businesses could go and get choice and competition for private health care plans, the same way that members of Congress get choice and competition for their health care plans. For people who couldn't afford it, we would provide them some subsidies. But because people would have some pooling power, the costs overall would be lower because they'd be in a stronger position to negotiate.
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In each of these cases there are corresponding ideas on the Republican side that we should be able to bridge. So I promise not to make a long speech. Let me just close by saying this. My hope in the several hours that we're going to be here today, that in each section that we're going to discuss -- how do we lower costs for families and small businesses, how do we make sure that the insurance market works for people, how do we make sure that we are dealing with the long-term deficits, how do we make sure that people who don't have coverage can get coverage -- in each of these areas what I'm going to do is I'm going to start off by saying, here are some things we agree on. And then let's talk about some areas where we disagree, and see if we can bridge those gaps.
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And I'd like to just mention those in a sentence or two. You mentioned Mike Enzi's work on the small business health care plan. That's a good start. It came up in the Senate. He will explain why it covers more people, costs less, and helps small businesses offer insurance, too, helping Americans buy insurance across state lines. You've mentioned that yourself. Most of the governors I've talked to think that would be a good way to increase competition.
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You began your remarks, , by saying there was a glimmer of bipartisanship in the Senate for the passage of the jobs bill. I want you to know there was a blaze of bipartisanship in the House yesterday -- with, what, 406-19, we passed under leadership of Congresswoman Louise Slaughter, Tom Perriello, Betsy Markey and others the lifting -- repealing the exemption that insurance companies have on health insurance and the antitrust laws for health insurance -- 406-19, a very strong message that, yes, the insurance companies need to be reined in. So put us down on that side of the ledger.
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Last Monday, a week ago Monday, all over America, results were run from a poll done by the Kaiser Foundation. It was interesting what that poll said: 58 percent of Americans would be disappointed or angry if we did not do health care reform this year -- 58 percent. Across America, more than 60 percent of Republicans, Democrats, and independents want us to reform the way health care works. Is it any wonder? They want it so that businesses can afford health care. They want to give consumers more choices and insurance companies more competition.
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REPRESENTATIVE MILLER: Thank you very much. This issue of insurance reform is I think where most families intersect with their insurance companies, with the health security of their families. And let's start out with our commonalities in the bill that REPRESENTATIVE Boehner -- Leader Boehner, offered on the floor. He agreed that lifetime caps should be abolished, that annual caps should be abolished, that young people should be able to stay on their parents' plan -- I think it was 25, I think, and your suggestion, , it's 26. So there's that kind of commonality there.
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So, Kathleen, why don't you just address some of the issues related to insurance reform. There’s some agreement here, but I know that on the Republican side there are a couple of concerns about the issue of rate review. The issue of setting up some benchmark standards that insurance companies have to abide by -- some people may think that those have been a little bit too aggressive.
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So getting rid of preexisting conditions, getting rid of caps on yearly benefits and longtime benefits, allowing kids to stay on plans are ideas that have been accepted by both -- setting up a new marketplace, giving small business owners and individuals choice and competition in the private sector, but making the private sector operate on a different set of rules, including having some loss-benefit analysis. How many of those dollars -- you heard Senator Coburn eloquently talk about the 30 cents of every dollar that goes to pay for expenses other than medical costs. A loss-benefit analysis, a medical ratio, would do just that.
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First of all, the cost, and Jon Kyl laid out the tremendous cost in the nearly trillion dollars of this bill. And I don't quite know, because CBO said it couldn't assess how much your additions would cost to it, but we do know that there are plenty of taxes on income. Now, you suggest investment income should be taxed. We have additional taxes on medical devices and the rest. What is a consequence of that? We know there are consequences that small businesses will feel because of the impact on job creation.
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Now, on preexisting conditions we've got a similar situation. The challenge we have -- I'd love to just pass a law that said, insurance companies, you can't exclude people based on preexisting conditions. The problem is what they'll say to you is, well, what prevents somebody from not preventing insurance until they get sick and then going in and just buying it and just gaming the system?
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"Because of preexisting conditions, I have been denied access to coverage under more economical insurance plans. Therefore I am stuck in an expensive pool and have few options. The best option would be for the U.S. Congress to pass comprehensive health care reform resulting in affordable health care for all. The health of my family and the future of small business depends on it. Sincerely, Raymond Smith, Buffalo Center, Iowa."
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Now, a lot of the people that I talk to want us to start over in this issue and they want us to give them the ability to hold insurance companies accountable. One of those ways is through very robust competition. And when you have a district like mine in Tennessee, where the bulk of our constituents are within 15 miles of the state line, the ability for those individuals -- who have families and live and work and have employees on the other side of the state line who shop for major purchases every day -- is to allow them to be able to make those purchases.
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Also, when you talk about holding insurance companies accountable, if you want to empower patients in front of those insurance companies, take the power away from them, then give them the ability to buy a policy that suits their needs. They are really tired of paying for coverage they don't want. If you want to prevent premium acceleration, such as the issue in California right now, where the premiums have gone up 39 percent, if you are siding with protecting those insurance companies and not allowing across-state-line competition, then what you're doing is denying Californians the ability to go to Oregon, where they could buy a policy for 25 percent less, or individuals in New Jersey who could go to Pennsylvania and buy a policy and lower their cost 26 percent, or go to Wisconsin and buy one and lower their cost 74 percent.
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There's another important point here. The bill that you all are proposing would not put these in place until 2016, and quite frankly I think a lot of the American people agree with us that care delayed and access delayed is care and access denied. And they would like to see those -- basically what you have -- state lines right now basically have stop signs up when it comes to across state line access. They would like to see that come down, and like to see those access portals opened up so that they can first lower their cost, secondly so that they have greater ability to hold insurance companies accountable. And then also state legislators, even some of our governors -- many of the governors -- favor approaching this model and allowing our constituents a way to access this, get the cost down. And I will be brief so that we can move on to other topics. Thank you.
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Number one, with respect to California, for example, the problem, as was presented yesterday, in California, was not that there were a whole bunch of insurance companies from other states who were clamoring in to get into California to sell insurance to those individuals who saw their premiums spike by 39 percent. There weren't.
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I promise you that the problem that's going on in California is going on in every state. It's not unique to California. It's not as if there are insurance companies that are given great deals in Iowa. That gentleman farmer who just talked about -- these are some structural problems that exist in every state.
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REPRESENTATIVE BOUSTANY: Thank you, Leader Boehner, and thank you, . I come at this as a physician, a cardiovascular surgeon with over 20 years of practice doing open-heart surgery, dealing with patients who have come to me with very challenging cases at very difficult times in their lives. And along with my colleagues, Dr. Coburn and Dr. Barrasso, we bring a wealth of experience in dealing with insurance companies and all these everyday problems that so many American families face. We all agree -- we all agree -- that we need insurance reform. There's no question about it. The question is how do we do it.
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Now, we've all been through a long year -- town hall meetings, telephone calls, e-mails -- it goes on and on. And one thing that has become very clear, the American people have spoken out very loudly and very clearly. They want us to take a step back, and go step by step with a common-sense plan that really brings the costs down for American families and small business owners. They want insurance companies to treat them just like they treat big labor unions and large companies. It's been a resounding message we've heard over and over.
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Health savings accounts -- these are very, very popular among small business owners and families. And I think the one impediment today is the inability to save enough in these. And I think there are ways that we could promote these health savings accounts and promote real savings that will actually make a difference. It won't solve all the problems, but it's an important insurance reform that I think small businesses will really, really jump on if we could expand those savings opportunities. The current bill, as has been stated, adds some restrictions and some additional tax provisions on these, which make them less palatable.
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The other thing we do is we create a way for small business owners to actually shop and compare apples to apples -- transparency -- and this is critical. Our plan does this without creating the kinds of restrictions that we see with the exchange process. And we agree that we have to eliminate annual and lifetime caps, so we have broad agreement there.
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So look -- and the source of how we do this is getting rid of waste, making sure that we don't overpay insurance companies for Medicare Advantage. I want to remind everybody about Medicare Advantage, because some of us around here -- probably all of us around this table were here when it got put in. What was the rationale for Medicare Advantage? The rationale for Medicare Advantage a decade ago was that private insurers could provide insurance -- better insurance -- cheaper than the government can do it. They can do it better.
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And essentially what my proposal would do, and what the House and Senate proposals would do, would say, instead of having the insurance companies get that money, let’s take that money -- the savings are between $400 billion and $500 billion a year -- and let’s devote some of that money to closing the doughnut hole, which has already been talked about. Seniors who need more prescription drugs than Medicare currently is willing to pay for hit this gap where suddenly they’ve got to use it out of pocket, and they just stop taking the drugs, or they break them in half, or what have you. Let’s fill that. That costs around $30 billion a year, or $300 billion. And let’s make some other changes that would result in actually the 80 percent of seniors who aren’t in Medicare Advantage getting a better deal.
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Well, I think that's a legitimate point. I would just point out that 80 percent of seniors are helping to pay in extra premiums for the 20 percent who are in this Medicare Advantage. And it's not means-tested, so it's not as if the people who are in Medicare Advantage are somehow the poor people who can't afford supplementals. It's pretty random. And what we also know is, and I just want to point this out, Tom, $180 billion of it is going to insurance companies. It's not going to seniors. It's going to insurance companies, including big insurance company profits -- without any appreciable improvement in health care benefits. That's not a good way for us to spend money.
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So, , I would just say the thing that I would love for us to get into the details of, in terms of those deficit reductions that are made is the fact that we do it while putting the brakes on Medicare overpayments that went to insurance companies, which were getting reimbursed at greater levels than were doctors and hospitals that relied on a traditional Medicare fee for service, to provide services to our seniors.
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SENATOR GRASSLEY: First of all, to clarify something, if anybody says that Medicare Advantage is a subsidy going to insurance companies, let me say what the statute says. The statute says that 75 -- with a big differential where it goes -- 75 percent goes to beneficiaries and benefits and 25 percent to the federal government.
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It's a fact that when you do these things, you hurt the economy because small business is the machine that brings employment in America -- 70 percent of new employment. We've got to be careful of how you treat small business. And small business can be -- the health care needs of small business can take -- be taken care of with these association health plans and other things that can be done to make it beneficial. Thirty-five states have high-risk pools. Most of them, 150 percent is the maximum cost.
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You can make an argument that whatever savings we get out of Medicare Advantage should not go to filling the doughnut hole, for example. That's a legitimate argument. You can make an argument that it should go just to deficit reduction. Those are all legitimate arguments. But my point is that the savings that are obtained here are from a program in which insurance companies are making a lot of money but seniors who are in these kinds of programs are not better off, and the 80 percent of the people who are [not] in these programs are paying an extra 90 bucks a year to subsidize the folks who are in them. And that just doesn’t seem like a good deal for them or for the taxpayer.
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The way we tried to do it was not a government-run health care plan, Paul. I mean, that was some good poll-tested language that has been used quite a bit, but the fact of the matter is, is that, as Dick just alluded to, the way we've structured it through the exchange would be to allow people to pool, allow everybody to join a big group, and for people who can't afford it, to give them subsidies, including small businesses. And so the question is whether there is a way for us to arrive at an agreement that would reach those people.
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We can have an honest disagreement as to whether we should try to give some help to those 27 million people who don't have coverage. And so that's I think the last aspect of this, and this is probably going to be the most contentious because there is no doubt that providing those tax credits to families and small businesses costs money. And we do raise revenues in order to pay for that. And it may be that the other side just feels as if, you know what, it's just not worth us doing that.
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And this notion somehow that for them the system was working and that if they just ate a little better and were better health care consumers they could manage is just not the case. The vast majority of these 27 million people or 30 million people that we're talking about, they work every day. Some of them work two jobs. But if they're working for a small business, they can't get health care. If they are self-employed, they can't get health care.
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Another woman had asthma, and that was considered a preexisting condition. She was going to face a 39 percent increase, as well. Now, if they were pooled with everybody else in that small business and individual market, which is what our bill does, then there are more people buying insurance and there's more -- there's more leverage. It's spreading the cost, not making people have to pay more of these costs.
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The people who we're talking about are people in small businesses where the small business can't get insurance because, well, they got one employee with a real serious medical problem. So nobody in that group is going to get coverage, the employer can't afford it. Or women, it costs more for small businesses if they're in that workforce, especially if they're older. They don't want to get coverage. They don't want to give them coverage either.
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He went out in my city in Connecticut and organized 19,000 small businesses, and they changed the law in Connecticut regarding pooling in small businesses, because here was a small business guy who wanted to take care of his people and watched tragically day after day what happened to individuals because he could not provide it for them any longer.
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There was a study just out that in the state of California health care premiums would go down 50 percent if Californians could buy insurance from Nevada or Oregon. If you create a catastrophic high-risk pool and put the cap on it that Leader Boehner did on his alternative on the House floor, and allow small businesses to create the kind of pools that we've talked about, you're going to be able to give those Americans who can't get insurance because of a preexisting condition and want it the ability to get into those things. And their premiums will not go up catastrophically. They will not go up astronomically.
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, I've been very pleased that you've constantly been coming back to the system for members of Congress. Folks, all of us can fire our insurance company, every one of us. And as far as I'm concerned, we've got to stay in this battle until everybody in the United States has that right to hold the insurance companies accountable and to fire them.
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I'm just going to make this remark, and then I'm going to call on Patty Murray -- I'm going to save the two lions of the House here for the end -- because there's been a lot of comments from every Republican about the polls and what they're hearing from their constituents. And, as I said, I hear from constituents in every one of your districts and every one of your states. And what's interesting is actually when you poll people about the individual elements in each of these bills, they're all for them. So you ask them, do you want to prohibit preexisting conditions? Yes, I'm for that. Do you want to make sure that everybody can get basic coverage that's affordable? Yes, I'm for that. Do you want to make sure that insurance companies can't take advantage of you and that you've got the ability, as Ron said, to fire an insurance company that's not doing a good job and hire one that is, but also, that you've got some basic consumer protections? Yes, we like that.
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I think about him every time we talk about this bill. And what happened to her is happening to so many Americans who when they get sick today don't have any choices. They have nowhere to go. Either they don't have insurance or they've been denied insurance because they don't -- because they have a preexisting condition or they're a small business whose premiums have gone up so dramatically that they can no longer afford to provide it for their employees. Too many Americans today are in a box and they don't have a choice.
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I'm always surprised when I can find somebody that's defending the insurance companies after the things that they do to the ordinary people in this country. They could cancel your insurance policy while you're on the gurney headed into the operating room. Somebody would -- if somebody would explain that to me, I would be deeply grateful.
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SPEAKER PELOSI: Thank you very much, . As one who has abided by the three and a half minute, I'm going to take a few seconds more now in closing to extend thanks to you, , for bringing us together, for your great leadership, and without it, we would not be so very close to affordability, accountability for the insurance companies, and accessibility for so many more Americans to improve their health care, to lower their cost.
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Well, I bring that up because we come such a long way. We're talking about how close we are on this, how far apart we are here. But as a representative of the House of Representatives, I want you to know that we were there that day in support of a public option, which would save $120 billion, keep the insurance companies honest, and increase competition.
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We've come a long way to agreeing to a Republican idea -- the exchanges. Senator Enzi has been a leader in that. Senator Snowe, along with Senator Durbin, had legislation to that effect -- bipartisan. It caused the insurance companies opposed the public option. They couldn't take the competition.
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We have in our bill market-oriented, encouraging to the private sector, initiatives. I think the insurance industry, left to its own devices, has behaved shamefully. And we must act on behalf of the American people. We have lived on their playing field all this time. It's time for the insurance companies to exist on the playing field of the American people.
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The second thing I think we agree on is the idea that allowing small businesses and individuals who are right now trapped in the individual market and as a consequence have to buy very expensive insurance and effectively oftentimes just go without insurance could be solved if we allowed them to do what members of Congress do, which is be part of a large group.
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In the credit card market, part of what happened was we ended up allowing people to get credit cards from every other -- whatever state, and there were a few states that decided, you know what, we're going to have the least restrictions on credit card companies that we could have. And what ended up happening was that every single credit card company suddenly lo and behold started locating in that state which had the absolute worst regulations in consumer protections, and all these fees and practices that people don't like, folks weren't happy about.
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Now, it is absolutely true -- and I think this is important to get on the table, because we dance around this sometime -- in order to help the 30 million, that's going to cost some money. And the primary way we do it is to say that, for example, people who currently get all their income in capital gains and dividends, they don't pay a Medicare tax, even though the guy who cleans the building for them does on his salary or his wages.
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And so what we say is, if you make more than $250,000 a year if you're a family and your income is from those sources, then you should do -- you should have to do the same thing that everybody else has to do. Somebody mentioned the fact that we say to small businesses -- I think Jon Kyl, you said, we're taxing small businesses. Look, we exempt 95 percent of small businesses from any obligations whatsoever because we understand that small businesses generally have a tough time enough -- they don't need any more government burden.
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Good evening, everybody. Tonight, after nearly 100 years of talk and frustration, after decades of trying, and a year of sustained effort and debate, the United States Congress finally declared that America’s workers and America's families and America's small businesses deserve the security of knowing that here, in this country, neither illness nor accident should endanger the dreams they’ve worked a lifetime to achieve.
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Most importantly, today’s vote answers the prayers of every American who has hoped deeply for something to be done about a health care system that works for insurance companies, but not for ordinary people. For most Americans, this debate has never been about abstractions, the fight between right and left, Republican and Democrat -- it’s always been about something far more personal. It’s about every American who knows the shock of opening an envelope to see that their premiums just shot up again when times are already tough enough. It’s about every parent who knows the desperation of trying to cover a child with a chronic illness only to be told “no” again and again and again. It’s about every small business owner forced to choose between insuring employees and staying open for business. They are why we committed ourselves to this cause.
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If you don’t have insurance, this reform gives you a chance to be a part of a big purchasing pool that will give you choice and competition and cheaper prices for insurance. And it includes the largest health care tax cut for working families and small businesses in history -- so that if you lose your job and you change jobs, start that new business, you’ll finally be able to purchase quality, affordable care and the security and peace of mind that comes with it.
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In the end, what this day represents is another stone firmly laid in the foundation of the American Dream. Tonight, we answered the call of history as so many generations of Americans have before us. When faced with crisis, we did not shrink from our challenge -- we overcame it. We did not avoid our responsibility -- we embraced it. We did not fear our future -- we shaped it.
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I heard from Ryan Smith, who’s here today, and runs a small business with five employees. He is trying to do the right thing, paying for half of the cost of coverage for his workers. But as his premiums keep on going up and up and up, he’s worried he’s going to have to stop offering health care for his people. But because of this bill he is now going to be getting tax credits that allow him to do what he knows is the right thing to do -- and that's going to be true for millions of employers all across America.
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This year, we’ll start offering tax credits to about 4 million small businesses to help them cover the cost of coverage. And that means that folks like Ryan will immediately get a tax break so that he can better afford the coverage he’s already providing for his employees. And who knows, because of that tax break, he may decide to hire a couple more folks in his small business -- because of this legislation.
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This year, insurance companies will no longer be able to drop people’s coverage when they get sick, or place lifetime limits or restrictive annual limits on the amount of care they can receive. This year, all new insurance plans will be required to offer free preventive care. And this year, young adults will be able to stay on their parents’ policies until they’re 26 years old. That all happens this year.
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So these are the reforms that take effect right away. These reforms won’t give the government more control over your health care. They certainly won’t give the insurance companies more control over your health care. These reforms give you more control over your health care. And that’s only the beginning.
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Once this reform is implemented, health insurance exchanges will be created, a competitive marketplace where uninsured people and small businesses will finally be able to purchase affordable, quality insurance. They will be able to be part of a big pool and get the same good deal that members of Congress get. That’s what’s going to happen under this reform. And when this exchange is up and running, millions of people will get tax breaks to help them afford coverage, which represents the largest middle-class tax cut for health care in history. That's what this reform is about.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
But here’s what the bill does. It finally tells the insurance companies that in exchange for all the new customers they’re about to get, they’ve got to start playing by a new set of rules that treats everybody honestly and treats everybody fairly. The days of the insurance industry running roughshod over the American people are over.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
And meanwhile, there are a set of reforms that begin to take into effect this year, so I want to talk about this. This year, millions of small business owners will be eligible for tax credits that will help them cover the cost of insurance for their employees. This year, millions of small businesses will benefit.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
So let me talk to you about what this means for a business like your own Prairie Lights Bookstore downtown. This is a small business that’s been offering coverage to their full-time employees for the last 20 years. Last year their premiums went up 35 percent, which made it a lot harder for them to offer the same coverage. On Tuesday, I was joined at the bill signing by Ryan Smith, who runs a small business with five employees. His premiums are going up too. He’s worried about having to stop offering health insurance to his workers.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
So starting now, small business owners like Ryan and the folks at Prairie Light, they’re going to have the security of knowing that they’ll qualify for a tax credit that covers up to 35 percent of their employees’ health insurance. Starting today, starting today, small business owners -- so starting today, small business owners can sit down at the end of the week, look at their expenses, and they can begin calculating how much money they’re going to save. And maybe they can even use those savings to not only provide insurance but also create jobs. This health care tax credit is pro-jobs, it is pro-business, and it starts this year, and it’s starting because of you.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
And once this reform is implemented, then health insurance exchanges are going to be created. This is the core -- the core aspect of this bill that is going to be so important to Americans who are looking for coverage. Basically, we set up a competitive marketplace where people without insurance, small businesses, people who were having to pay through the teeth because they’re just buying insurance on their own, maybe you’re self-employed -- you’re finally going to be able to purchase quality, affordable, health insurance because you’re going to be part of a big pool -- by the way, with members of Congress. So you will be able to get the same good deal that they’re getting, because if you’re paying their salary, you should have health insurance that’s at least as good as theirs.
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Remarks by the President on Health Insurance Reform, University of Iowa Field House, Iowa City, Iowa
If these congressmen in Washington want to come here in Iowa and tell small business owners that they plan to take away their tax credits and essentially raise their taxes, be my guest. If they want to look Lauren Gallagher in the eye and tell her they plan to take away her father’s health insurance, that’s their right. If they want to make Darlyne Neff pay more money for her check-ups, her mammograms, they can run on that platform. If this young man out here thinks this is a bad bill, he can run to repeal it. If they want to have that fight, we can have it. Because I don’t believe that the American people are going to put the insurance industry back in the driver’s seat. We’ve already been there. We're not going back. This country is moving forward.
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We’ll make a significant new investment in community health centers all across America that can provide high-quality primary care to people who need it most. And we’ll strengthen efforts to combat waste and fraud and abuse, to make sure your dollars aren’t lining the pockets of insurance companies when they should be making your health care better.
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Now, the debate on health care reform is one that’s gone on for generations, and I’m glad -- I’m gratified that we were able to get it done last week. But what’s gotten overlooked amid all the hoopla, all the drama of last week, is what happened in education -- when a great battle pitting the interests of the banks and financial institutions against the interests of students finally came to an end.
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So I’ll close by saying this. For a long time, our student loan system has worked for banks and financial institutions. Today, we’re finally making our student loan system work for students and our families. But we’re also doing something more.
From the moment I was sworn into office, I’ve spoken about the urgent need for us to lay a new foundation for our economy and for our future. And two pillars of that foundation are health care and education, and each has long suffered from problems that we chose to kick down the road.
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We agreed to continue working aggressively to sustain the global economic recovery and create jobs for our people. And this includes, as we agreed with our G20 partners at Pittsburgh, to replacing the old cycle of bubble and bust with growth that is balanced and sustained. And this requires effective coordination by all nations. To that end, I updated the President on our efforts to pass financial reform, and I look forward to the Senate taking action on this landmark legislation so we never repeat the mistakes that led to this crisis.
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We must provide sufficient oversight so that reckless speculation or reckless risk-taking by a few big players in the financial markets will never again threaten the global economy or burden taxpayers. We must assure that consumers of financial products have the information and safeguards that they need, so their life savings are not placed in needless jeopardy. And that’s why I press for the passage of these reforms through Congress when they return, and I will continue to work with President Sarkozy and other world leaders to coordinate our efforts, because we want to make sure that whatever steps we’re taking, they are occurring on both sides of the Atlantic.
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Now, on financial regulation, again, it’s great news for the world to hear that the United States is availing itself of rules, adopting rules so that we not go back to what we have already experienced. And during the French presidency of the G20, Tim Geithner, Christine Lagarde are going to be working hand-in-glove in order to go even further in regulating world capitalism, and in particular, raising the issue of a new world international monetary order.
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So let’s be clear: Workplace flexibility isn’t just a women’s issue. It’s an issue that affects the well-being of our families and the success of our businesses. It affects the strength of our economy -- whether we’ll create the workplaces and jobs of the future we need to compete in today’s global economy.
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This is not a decision that I’ve made lightly. It’s one that Ken and I -- as well as Carol Browner, my energy advisor, and others in my administration -- looked at closely for more than a year. But the bottom line is this: Given our energy needs, in order to sustain economic growth and produce jobs, and keep our businesses competitive, we are going to need to harness traditional sources of fuel even as we ramp up production of new sources of renewable, homegrown energy.
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So the answer is not drilling everywhere all the time. But the answer is not, also, for us to ignore the fact that we are going to need vital energy sources to maintain our economic growth and our security. Ultimately, we need to move beyond the tired debates of the left and the right, between business leaders and environmentalists, between those who would claim drilling is a cure all and those who would claim it has no place. Because this issue is just too important to allow our progress to languish while we fight the same old battles over and over again.
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And while our politics has remained entrenched along these worn divides, the ground has shifted beneath our feet. Around the world, countries are seeking an edge in the global marketplace by investing in new ways of producing and saving energy. From China to Germany, these nations recognize that the nation that leads the clean energy economy will be the country that leads the global economy. And meanwhile, here at home, as politicians in Washington debate endlessly about whether to act, our own military has determined that we can no longer afford not to.
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Now, since I last spoke here two years ago, our country has been through a terrible trial. More than 8 million people have lost their jobs. Countless small businesses have had to shut their doors. Trillions of dollars in savings have been lost -- forcing seniors to put off retirement, young people to postpone college, entrepreneurs to give up on the dream of starting a company. And as a nation we were forced to take unprecedented steps to rescue the financial system and the broader economy.
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But you’re here and I’m here because we’ve got more work to do. Until this progress is felt not just on Wall Street but on Main Street we cannot be satisfied. Until the millions of our neighbors who are looking for work can find a job, and wages are growing at a meaningful pace, we may be able to claim a technical recovery -- but we will not have truly recovered. And even as we seek to revive this economy, it’s also incumbent on us to rebuild it stronger than before. We don’t want an economy that has the same weaknesses that led to this crisis. And that means addressing some of the underlying problems that led to this turmoil and devastation in the first place.
Now, one of the most significant contributors to this recession was a financial crisis as dire as any we’ve known in generations -- at least since the ’30s. And that crisis was born of a failure of responsibility -- from Wall Street all the way to Washington -- that brought down many of the world’s largest financial firms and nearly dragged our economy into a second Great Depression.
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I’ve spoken before about the need to build a new foundation for economic growth in the 21st century. And given the importance of the financial sector, Wall Street reform is an absolutely essential part of that foundation. Without it, our house will continue to sit on shifting sands, and our families, businesses, and the global economy will be vulnerable to future crises. That’s why I feel so strongly that we need to enact a set of updated, commonsense rules to ensure accountability on Wall Street and to protect consumers in our financial system.
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Now, first, the bill being considered in the Senate would create what we did not have before, and that is a way to protect the financial system and the broader economy and American taxpayers in the event that a large financial firm begins to fail. If there’s a Lehmans or an AIG, how can we respond in a way that doesn’t force taxpayers to pick up the tab or, alternatively, could bring down the whole system.
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In an ordinary local bank when it approaches insolvency, we’ve got a process, an orderly process through the FDIC, that ensures that depositors are protected, maintains confidence in the banking system, and it works. Customers and taxpayers are protected and owners and management lose their equity. But we don’t have that kind of process designed to contain the failure of a Lehman Brothers or any of the largest and most interconnected financial firms in our country.
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But this is why we need a system to shut these firms down with the least amount of collateral damage to innocent people and innocent businesses. And from the start, I’ve insisted that the financial industry, not taxpayers, shoulder the costs in the event that a large financial company should falter. The goal is to make certain that taxpayers are never again on the hook because a firm is deemed “too big to fail.”
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So by enacting these reforms, we’ll help ensure that our financial system -- and our economy -- continues to be the envy of the world. That’s the first thing, making sure that we can wind down one firm if it gets into trouble without bringing the whole system down or forcing taxpayers to fund a bailout.
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Number two, reform would bring new transparency to many financial markets. As you know, part of what led to this crisis was firms like AIG and others who were making huge and risky bets, using derivatives and other complicated financial instruments, in ways that defied accountability, or even common sense. In fact, many practices were so opaque, so confusing, so complex that the people inside the firms didn’t understand them, much less those who were charged with overseeing them. They weren’t fully aware of the massive bets that were being placed. That’s what led Warren Buffett to describe derivatives that were bought and sold with little oversight as “financial weapons of mass destruction.” That’s what he called them. And that’s why reform will rein in excess and help ensure that these kinds of transactions take place in the light of day.
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And I was encouraged to see a Republican senator join with Democrats this week in moving forward on this issue. That's a good sign. That's a good sign. For without action, we’ll continue to see what amounts to highly-leveraged, loosely-monitored gambling in our financial system, putting taxpayers and the economy in jeopardy. And the only people who ought to fear the kind of oversight and transparency that we're proposing are those whose conduct will fail this scrutiny.
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And while a few companies made out like bandits by exploiting their customers, our entire economy was made more vulnerable. Millions of people have now lost their homes. Tens of millions more have lost value in their homes. Just about every sector of our economy has felt the pain, whether you’re paving driveways in Arizona, or selling houses in Ohio, or you're doing home repairs in California, or you’re using your home equity to start a small business in Florida.
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Number four, the last key component of reform. These Wall Street reforms will give shareholders new power in the financial system. They will get what we call a say on pay, a voice with respect to the salaries and bonuses awarded to top executives. And the SEC will have the authority to give shareholders more say in corporate elections, so that investors and pension holders have a stronger role in determining who manages the company in which they’ve placed their savings.
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In the end, our system only works -- our markets are only free -- when there are basic safeguards that prevent abuse, that check excesses, that ensure that it is more profitable to play by the rules than to game the system. And that is what the reforms we’ve been proposing are designed to achieve -- no more, no less. And because that is how we will ensure that our economy works for consumers, that it works for investors, and that it works for financial institutions -- in other words, that it works for all of us -- that’s why we’re working so hard to get this stuff passed.
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This is the central lesson not only of this crisis but of our history. It’s what I said when I spoke here two years ago. Because ultimately, there is no dividing line between Main Street and Wall Street. We will rise or we will fall together as one nation. And that is why I urge all of you to join me. I urge all of you to join me, to join those who are seeking to pass these commonsense reforms. And for those of you in the financial industry, I urge you to join me not only because it is in the interest of your industry, but also because it’s in the interest of your country.
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All that hard work, all that hardship, all the time spent underground, it was all for the families. It was all for you. For a car in the driveway, a roof overhead. For a chance to give their kids opportunities that they would never know, and enjoy retirement with their spouses. It was all in the hopes of something better. And so these miners lived -– as they died -– in pursuit of the American Dream.
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We’re joined by members of Congress who work every day to help their constituents realize the American Dream, and whose life stories reflect the diversity and equal opportunity that we cherish as Americans: Nydia Velazquez, who is also, by the way, the chairwoman of our Small Business Committee in the House of Representatives. Keith Ellison is here. And Andre Carson is here.
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We have successes like Dr. Mohamed Ibrahim, who I met earlier, who built a telecommunications empire that empowered people across Africa. And we have aspiring entrepreneurs who are looking to grow their businesses and hire new workers. Together you can address the challenges of accessing capital. We have trailblazers like Sheikha Hanadi of Qatar, along with Waed al Taweel, who I met earlier -- a 20-year-old student from the West Bank who wants to build recreation centers for Palestinian youth. So together, they represent the incredible talents of women entrepreneurs and remind us that countries that educate and empower women are countries that are far more likely to prosper. I believe that.
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The United States is launching several new exchange programs. We will bring business and social entrepreneurs from Muslim-majority countries to the United States and send their American counterparts to learn from your countries. So women in technology fields will have the opportunity to come to the United States for internships and professional development. And since innovation is central to entrepreneurship, we’re creating new exchanges for science teachers.
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And tonight, I can report that the Global Technology and Innovation Fund that I announced in Cairo will potentially mobilize more than $2 billion in investments. This is private capital, and it will unlock new opportunities for people across our countries in sectors like telecommunications, health care, education, and infrastructure.
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When I took office, the first thing we had to do was mount an aggressive response to the worst economic crisis we'd seen since the Great Depression, because we didn’t want a second Great Depression. And let’s face it, some of the steps we took were unpopular. I didn’t like them. Nobody wanted to have to fix the financial system. That wasn’t part of what I ran on. I ran on making sure we regulated the financial system, but I didn’t run on having to make sure it didn’t collapse. But I also knew that some of the things we did were the right thing to do in order to make sure that the situation didn’t get worse.
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And by the way, one of those steps was called the Recovery Act. And I want everybody to understand here’s what it did. First of all, one-third of it was tax cuts. We cut taxes for small businesses -- (applause.) So one-third -- when you hear of the Recovery Act, I want you to understand a third of that went to tax cuts for small businesses, for first-time homebuyers -- some of you have been first-time homebuyers and gotten that $8,000 credit -- for students and parents who were paying for college. And we cut taxes for 95 percent of working Americans -– 1.1 million working families here in Iowa -– because that’s what I told you I’d do during the campaign.
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So here is what’s going to happen this year. Seniors are going to help -- get help paying for their prescription drugs -- this year. Millions of small business owners, including farmers, will be eligible for tax credits to help insure their employees -- this year. Parents of children with preexisting conditions will finally be able to purchase the coverage that they need -- this year. Insurance companies won’t be able to drop you when you get sick -- this year. By the way, if you’re a young person here, you’ll be able to stay on your parents’ policy till you’re 26 -- starting this year.
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And in a couple years, after we’ve set the whole thing up, millions of families and small business owners, they’re going to have more choice, more competition, and they’re going to finally be able to purchase quality, affordable care and get a better deal because they’re going to be part of a big pool. The reason that it’s cheap for federal employees, for example, to get good health insurance is because there are millions of federal employees, so they’ve got a lot of bargaining power. It forces insurance companies to lower their rates and give them a better deal.
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Now, I don’t know where they were over the last 10 years, why they weren’t protesting and all that. That’s fine. I’m the President -- the buck stops with me. And we did have to add -- we did have to add short term to the deficit to deal with the economic crisis. All that unemployment benefits, those COBRA extensions, et cetera, that cost money. But we’ve also taken real concrete steps to address the long-term deficits that loom over our future.
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Now, we haven’t been perfect. That’s for sure. Michelle could have warned you, I’m not perfect. But I want -- what I want you to know is that every single thing we are trying to accomplish, every policy we put in place, every day that I go to work, it’s about restoring a sense of security for the middle class and renewing the American Dream for folks like you -- because you’re the ones who inspired me to run. Whether you support me or not, it’s towns like this and families like yours that I spend my time thinking about.
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Q I’m in -- I run a small business and we sell equipment, manufacturing equipment, and then we do leasing on that equipment. And I’m real concerned over we seem like we continue to lose manufacturing jobs overseas. And it’s a drain on that. And then we also have in our -- we try to arrange for financing. Our shops that are -- our small machine shops that are just everyday working guys that are really trying to make a living are now in a situation that their credit is challenged.
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On the financing side, one of the biggest problems we still have in our economy -- we made sure that the financial system didn’t collapse, but a lot of banks have still pulled back, and they’ve pulled back especially from small businesses. So everywhere I go, I talk to small business owners who say, you know, we’re actually starting to get orders now but I can’t get a credit line from my bank.
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But one of our proposals is to have some of that money used to help get small business loans out. And so this is going to be something that we’re debating. If we can start loosening up credit for small businesses, and helping smaller and community banks with their lending portfolios, that will make a huge difference in terms of the pace of our economic growth. So this is really a top priority for our administration.
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And meanwhile, while we talked, other nations acted. From Spain to China, other nations recognized that the country that leads the clean-energy economy will be the country that leads the 21st century global economy. They were making serious investments to win that race and the jobs that come with it.
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As a nation, we continue to experience the consequence of three distinct but closely related challenges. One is a financial crisis, born of reckless speculation that threatened to choke off lending to families and to businesses. And this crisis, in turn, led to the deepest recession we’ve known in generations –- costing millions of Americans their jobs and their homes, closing thousands of businesses and devastating Main Streets across the country. And over the past two years, this downturn has aggravated an already severe fiscal crisis, brought on by decades of bad habits in Washington.
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Now, over the past year, we’ve had to take emergency measures to prevent the recession from becoming another depression. And at a time when millions of people are out of work, we’ll continue to do what it takes to spur job creation while investing in a new foundation for lasting economic growth. But the emergency measures have added about $1 trillion to the deficit over the next 10 years. As a result, even as we take these necessary steps in the short term, we have an obligation to future generations to address our long-term, structural deficits, which threaten to hobble our economy and leave our children and grandchildren with a mountain of debt.
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It’s towns like this where working men and women built the American Dream with their bare hands. This is where our roots are. I just met a young man coming in -- he says he’s my cousin. There he is, right there. Seriously, it’s -- what is it, fourth generation? Four generations back? I told him he was a little better looking than me.
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But all of us trace back to this experience of parents, grandparents, great-grandparents building this American Dream -- not having much to begin with. And that dream is shared by every Illinoisan and every American -- the chance to make a good living, to raise a healthy and secure family, and most of all, to give our kids opportunities that we didn’t have ourselves.
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So we took these steps to get America back on its feet. We aimed tax relief right at the middle class, the cornerstone of the American Dream. We made sure that we cut taxes for 95 percent of working families, put money in their pockets because they were experiencing hard times -- fewer hours or somebody in the family being laid off, making sure that they could still buy groceries and pay the bills to keep the economy afloat.
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We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for students and parents paying for college. And all of this -- not only did this help those individual families, but it increased purchasing power and spending power for businesses all across the country. And then we extended unemployment benefits and we made COBRA cheaper for folks who had lost their jobs. And then we helped give help to the states. And Pat Quinn will tell you, because of the federal assistance that was provided, we averted some massive layoffs of teachers and police officers and firefighters all across the country.
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And in a few years, millions of families and small business owners are going to have more choice, more competition. You’re going to be able to purchase the same kind of high-quality, affordable care that members of Congress get. And you know that’s going to be pretty good. You know they’re going to give themselves good insurance. You’re going to be able to buy it, too.
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This isn’t some abstraction. Sometimes, the folks who were fighting us, they made it sound as if, oh, he just wants big government, this -- no. I just want people to be able to not go bankrupt and lose their house when they get sick. I just want them not to have -- see their premiums doubled. I don’t want them to be taken advantage of by insurance companies. I want you to get a fair deal and a fair shake. And that’s part of my job as President of the United States of America.
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They made bets. They were making bets on what was going to happen in the housing market, and they would create these derivatives and all these instruments that nobody understood. But it was basically operating like a big casino. And it was producing big profits and big bonuses for them, but it was all built on shaky economics and some of these subprime loans that had been given out. And because we did not have common-sense rules in place, those irresponsible practices came awfully close to bringing down our entire economy and millions of dreams along with it.
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Now, what we’re doing -- I want to be clear, we’re not trying to push financial reform because we begrudge success that's fairly earned. I mean, I do think at a certain point you’ve made enough money. But part of the American way is you can just keep on making it if you’re providing a good product or you’re providing a good service. We don't want people to stop fulfilling the core responsibilities of the financial system to help grow the economy.
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I’ve said this before. I’ve said this on Wall Street just last week. I believe in the power of the free market. And I believe in a strong financial system. And when it’s working right, financial institutions, they help make possible families buying homes, and businesses growing, and new ideas taking flight. An entrepreneur may have a great idea, but he may need to borrow some money to make it happen. It would be hard for a lot of us to buy a house -- our first house, at least, if we weren’t able to take out a mortgage.
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I didn’t say lie, but -- they will tell stories about what’s going on. So let me just be very clear in terms of what we’re proposing on financial reform. First -- and I know this is important to you because it’s important to me -- we’re going to make sure the American taxpayer is never again on the hook when a Wall Street firm fails. Never again. We don’t want to see another bailout. That’s what this reform does.
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Now, you’ve got some -- you had some who were saying, cynically, just claiming the opposite, that somehow this was a bill that institutionalized bailouts. What this bill did was it said, no, if you have a firm on Wall Street that fails, the financial industry is going to pay -- not taxpayers. So a vote for reform is a vote to end taxpayer-funded bailouts once and for all. If a crisis like this again happens, financial firms are going to foot the bill. That’s point number one.
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Point number two -- we’re going to close the loopholes that allowed derivatives and all these other large, risky deals that don’t make a lot of economic sense and that could threaten our entire economy -- we want to bring those deals out into the -- out of the dark alleys of our financial system into the light of day, so that everybody knows exactly what’s happening, what risks are being taken -- investors, shareholders, everybody knows what’s going on. That’s the second thing.
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And your attorney general, Lisa Madigan, has been fighting on behalf of consumers in this state and she knows how badly we need these protections. In fact, Lisa and a bunch of other attorney generals came to testify on behalf of the need for these consumer protection bills because they see this stuff in their offices every day. And it’s true all across the country.
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Or are we going to protect consumers, and strengthen our financial system, and put rules in place that keep this from happening ever again? Are we going to give in to the special interests, or are we going to score another victory for the American people? Are we going to stick with the status quo? Or are we going to bring about fundamental change that makes things work for ordinary Americans?
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We are not powerless in the face of our challenges. We don’t quit when things get tough. We’re not afraid. When something happens, we come together. We move forward. We act. We are Americans -- our destiny is written by us, not for us. And if we remember that and summon that spirit once again, we’re going to strengthen our economy today and tomorrow, and restore security to the middle class.
That’s what we’re fighting for -- the American Dream right here in Quincy, right here in Illinois, all across the country.
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In the two years that I spent running for President and visiting towns like Macon, a lot of folks talked about how the American Dream seemed like it was starting to slip away. It was getting harder and harder to reach. Families were having a tougher time getting ahead. Farmers were having a tough time getting by. Worse yet, many young people had been convinced that the only way that they could make a go of it was if they moved someplace else.
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And we do this because you’re the key to our success in the global economy -– preparing our kids to compete at a time when a nation’s most valuable currency is the knowledge and skills of its people. And we do this because the impact you’ve had on all of our lives: pushing us, believing in us, insisting -– sometimes, despite all evidence to the contrary -– that we have potential and that we have something worthy to contribute.
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I’ve said many times that the recession we’re emerging from was primarily caused by a lack of responsibility and accountability from Wall Street to Washington. It’s part of the reason our economy nearly collapsed. It’s what led to countless home foreclosures, the failure of community banks and small businesses, and a cascade of job losses that have left millions of Americans out of work. And that's why I made passage of Wall Street reform one of my top priorities as President -– so that a crisis like this does not happen again.
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Today, I think it’s fair to say that these efforts have failed. Today, Democrats and a handful of Republicans in the Senate have voted to break the filibuster and allow a final debate and vote on financial reform -- reform that will protect consumers, protect our economy, and hold Wall Street accountable.
I want to thank Senator Chris Dodd and Majority Leader Reid for their leadership on this legislation, as well as all the senators who put partisan posturing aside in allowing a vote on this important reform. And I want to thank every American who kept the pressure on Washington to change a system that worked better for banks on Wall Street than it did for families on Main Street.
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Now, we’ve still got some work to do. Soon we’re going to have a final vote in the Senate, and then the House and the Senate will have to iron out the differences between the two bills. And there’s no doubt that during that time, the financial industry and their lobbyists will keep on fighting. But I will ensure that we arrive at a final product that is both effective and responsible -– one that holds Wall Street to high standards of accountability and secures financial stability, while preserving the strength and crucial functions of a financial industry that is central to our prosperity and our ability to innovate and compete in a global economy.
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Because of Wall Street reform, we’ll soon have in place the strongest consumer protections in history. If you’ve ever applied for a credit card, a student loan, or a mortgage, you know the feeling of signing your name to pages of barely understandable fine print. It’s a big step for most families, but one that’s often filled with unnecessary confusion and apprehension. As a result, many Americans are simply duped into hidden fees and loans they just can’t afford by companies that know exactly what they’re doing.
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Those days will soon end. From now on, every consumer will be empowered with the clear and concise information that you need to make financial decisions that are best for you. This bill will crack down on predatory practices and unscrupulous mortgage lenders. It will enforce the new credit card law we passed banning unfair rate hikes, and ensure that folks aren’t unwittingly caught by overdraft fees when they sign up for a checking account. It will give students who take out college loans information and make sure lenders don’t cheat the system. And it will ensure that every American receives a free credit score if they are denied a loan or insurance because of that score.
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Because of financial reform, the American people will never again be asked to foot the bill for Wall Street’s mistakes. There will be no more taxpayer-funded bailouts -- period. If a large financial institution should ever fail, we will have the tools to wind it down without endangering the broader economy. And there will be new rules to prevent financial institutions from becoming “too big to fail” in the first place, so that we don’t have another AIG.
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Because of reform, the kinds of complex, backroom deals that helped trigger the financial crisis will finally be brought to the light of day. And from now on, shareholders will have greater say on the pay of CEOs and other executives, so that they can reward success instead of failure, and help change the perverse incentives that encouraged so much reckless risk-taking in the first place.
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I also said when I took office that we can’t simply rebuild this economy on the same pile of sand -- on maxed-out credit cards or housing bubbles or reckless risk-taking on Wall Street. We’re going to have to build it on a firmer, stronger foundation for economic growth. That’s why we invested in renewable energies that currently have the potential of creating new jobs all across America. That’s why we’re reforming our education system so that our workers can compete on the global stage. That’s why we passed health care reform that will lower costs for families and businesses. And that’s why we’re about to pass financial regulatory reform -- to protect consumers and ensure that we don’t have another crisis caused by the irresponsibility of a few.
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We also have with us some legislative leaders who have been champions of not only the auto industry but also the environmental movement, and I want to thank them for being here. One of the deans of the House of Representatives, Representative John Dingell -- please give him a big round of applause. Representative Ed Markey is here from Massachusetts. Representative Chris Van Hollen is here. And Representative Henry Waxman.
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A lot of people thought such an agreement was impossible. After all, for decades we had made little headway in improving the fuel efficiency of our cars. We’d hear a lot of urgent talk in Washington when oil prices went up, then we’d see politicians rush to the local gas stations -– I remember going to gas stations -- holding press conferences, announcing new legislation. But the impetus for action would fade when gas prices started to go back down. Meanwhile, progress was mired in a lot of old arguments traded across entrenched political divides: left versus right, management versus labor, business leaders versus environmental advocates.
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But what we showed here one year ago today is that we could do something different. We proved that these were false choices. We brought together all the stakeholders, including former adversaries, to support a policy that would benefit consumers, workers, and the auto industry -– while strengthening the economy and protecting the planet. One year later, we’re beginning to see the results. Instead of fighting higher standards, auto manufacturers are engaged in a race to meet them. And over the next five years, we expect fuel efficiency standards in cars and light trucks to reach an average of 35.5 miles per gallon.
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But we also know that our economic future depends on our leadership in the industries of the future. Around the globe, countries are seeking an advantage in the global marketplace by investing in new ways of producing and saving energy. From China to Germany, these countries recognize that the nation that leads in the clean energy economy will lead the global economy. And I want America to be that nation.
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On the stage with me, we’ve got some -- the reason we’re here -- people who have helped to live out the American Dream and created jobs. And we are extraordinarily proud of them. We’ve got Trapper Clark and Thomas Sturtevant right over here. We’ve got Charles Reid right down here. And we’ve got Tamara Marquez-Nugent. These are the outstanding winners of this award, and you’re going to be hearing more about them. I also want to introduce somebody who I’m very proud of, who’s doing just a great job as our SBA Administrator, Karen Mills. Please give her a round of applause.
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This is the beginning of National Small Business Week, which every President has recognized since John F. Kennedy started the tradition in 1963. With us are some of the most successful, most hardworking entrepreneurs from across America. Each of you has distinguished yourselves as the Small Business Owner of the Year in your state or your region. Later today, a national winner will be announced. But all of you should be extremely proud of what you’ve accomplished this year. I know that I’m extremely proud of what you’ve accomplished.
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Being a successful small business person isn’t just about collecting a profit or outperforming your competition. It’s about contributing to the success of this country’s economy. It’s about contributing to your country’s continued growth and prosperity. And it’s about securing your piece of the American Dream and helping your employees and your suppliers and all the people you work with secure their piece of the American Dream.
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It’s how small businesses begin. Maybe somebody finally decides to take a chance on his dream. Maybe a worker decides it’s time to become her own boss. Either way, these entrepreneurial pioneers embody the spirit of possibility, the tireless work ethic, and the simple hope for something better that lies at the heart of the American ideal.
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Some of you have opened mom-and-pop stores that have led to America’s biggest, most successful companies. Some have launched technology companies -- software and IT services that have redefined the marketplace. You collectively create two out of every three jobs here in the United States of America -- two out of every three jobs. And that’s why small businesses aren’t just the backbone of this economy -- you’re also the driving force behind this recovery.
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The problem is, is that small business owners have also been the hardest hit by this recession. From the middle of 2007 through the end of 2008, small businesses lost 2.4 million jobs. And because banks shrunk from lending in the midst of the financial crisis, it’s been difficult for small business owners to take out the loans they need to open up shop or to expand. For those who do own a small business, it’s hard to finance inventories, make payrolls, or to do that additional work that could make your business grow.
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Now, government can’t create jobs, but it can help create the conditions for small businesses to grow and to thrive and to hire more workers. Government can’t guarantee a company’s success, but it can knock down the barriers that prevent small business owners from getting loans or investing in the future. And that’s why so much of our economic agenda has been focused on America’s small businesses.
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Last year, we enacted seven tax cuts for America’s small businesses, as well as Making Work Pay tax credits that go to the vast majority of small business owners. So far, the Recovery Act has supported over 64,000 loans to small businesses -- more than $27 billion in new lending. More than 1,200 banks and credit unions that had stopped making SBA loans when the financial crisis hit are lending again today. And more than $8 billion in federal Recovery Act contracts are now going to small businesses.
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So right now, a series of additional tax incentives and other steps to promote hiring are taking effect. Because of a bill I signed into law a few months ago, businesses are now eligible for tax cuts when they hire unemployed workers. Companies are also able to write off more of their investments in new equipment. And as part of the health reform package, 4 million small business owners recently received a postcard in their mailboxes telling them that they could be eligible for a health care tax credit this year. It’s worth perhaps tens of thousands of dollars to your companies. And it will provide welcome relief to small business owners, who -- I know you guys understand -- all too often have to choose between hiring or keeping your health care for yourselves and your workers.
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I also want to say a few words about what the SBA has been doing to help those workers and business owners who’ve been affected by the oil spill in the Gulf Coast. From the very beginning of this disaster, the SBA has acted quickly to assist fishermen and fishing-dependent small businesses. They’re offering low-interest loans and deferrals of existing loans. And while small businesses are encouraged to file claims with BP, these loans and deferrals can provide much needed temporary assistance.
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I just met with Trapper and Tom, who are the state of Maine’s Small Business Owners of the Year. Karen assures me that the reason they’re on stage is not because they’re from Maine, her home state. They started a company that manufactures aluminum trailers about four years ago with 20 employees. They’ve grown rapidly over the last few years, and that growth has been supported by a Recovery Act loan from the Small Business Administration. They got some of their fees waived. And today, they have 85 employees, are planning to add another 15 by the end of this year, and hope to add another 30 by the end of 2011.
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Ten years ago, they launched a glove-making business to provide flexibility and protection for our men and women in uniform. When they won a contract to supply gloves for soldiers in Iraq and Afghanistan in 2009, they received a Recovery Act loan through the SBA and saved thousands on fees. It was that loan that allowed Frank and Donna to rehire some employees who had been laid off during this recession, and today their business is growing and thriving once more.
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So many people who are here today have stories just like this. Their success isn’t the result of a heavy-handed government. It’s the result of a government that lent a helping hand -- that complements the sheer grit and determination of America’s small business owners. And I believe we need to do even more to give these men and women a boost.
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So that’s why I’m calling on Congress to pass small business jobs -- a small business jobs package as soon as possible. This legislation should ensure that creditworthy small business owners can get the capital they need to expand and create jobs. It should include needed tax relief, like our proposal to completely eliminate capital gains taxes for those making key long-term investments in small businesses. It should include expansions of vital Small Business Administration loan programs that are needed now more than ever. And it should include two important lending initiatives that I recently sent to Congress.
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The first initiative is the $30 billion Small Business Lending Fund I called for in my State of the Union address. This fund would target only small community and neighborhood banks, and it would help these institutions increase lending to small businesses. The second initiative is a new state small business credit program that we recently proposed, working with governors like Governor Doyle and Governor Granholm. It’s an initiative that will help expand private lending for small businesses and manufacturers at a time when budget shortfalls are leading states to cut back on vitally important lending programs.
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This shouldn’t be a partisan issue. This is not a Republican issue or a Democratic issue. This should not be an issue about big government versus small government. This is an issue that involves putting government on the side of small business owners who create most of the jobs in this country. It’s about giving them tax credits and loans and tax cuts so they can keep growing and keep hiring. It’s about unleashing the great power of our economy and the ingenuity of our people.
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And so we had to act quickly. And that meant that right away we had to make sure that we put in place mechanisms to put people back to work, to get the economy growing again. We had to cut taxes for small businesses and for individuals so that they would boost demand in the economy that was caving. It meant that we had to make sure that unemployment insurance and COBRA was in place so that people would have some safety net under them when they lost a job through no means of their own -- through no fault of their own.
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But it also meant that we had to make investments so that we would create a foundation for long-term growth in this country. See, we couldn’t keep on doing the same things we had been doing. It wasn’t good enough just to go back to the status quo ante. We couldn’t have a situation in which growth was premised on everybody maxing out on their credit cards, and taking out home equity loans, and getting deeper and deeper into debt, and wild speculation on the financial markets.
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And we thought about how could we restore an auto industry that was on the brink. But again, we couldn’t go back to the status quo. So what we did was we said, you know what, we’re going to make sure that GM and Chrysler aren’t liquidated, but we’re going to make sure that we invest in advanced battery technologies and hybrid technologies so that we can start seeing a future of plug-in hybrids that get 150 miles a gallon so that we can start breaking our dependence on foreign oil.
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And so after the -- over the last several months, after we finished with health care, we’ve tackled financial regulatory reform. We’ve now passed it through the House. We’ve now passed it through the Senate. And we are going to pass it through Congress. And then I’m going to sign that bill to make sure that we don't have taxpayer bailouts for irresponsible behavior in our financial sector.
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And that’s what I want to talk to you about tonight –- because reviving our economy remains the central challenge that we’re facing today. I don’t have to tell you folks here in California, this state has been hit as hard as any state with economic troubles over the past few years. Jobs have been lost in heartbreaking numbers up and down the coast. The housing crisis hit the state with a vengeance. The budget problems have put a further strain on people here at a time when they really need help, and that forces the state government to make painful choices about where to spend, where to save.
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Now, you’ve heard that said before, but think about that -- think about that -- this is the worst economic crisis that many of the people in this room have seen in their lifetimes. And the fact is, is that a lot of folks didn't know what to do. And there were some economists who said that we may be falling over a precipice: The banking sector had completely locked up, no credit was flowing, and we might end up seeing a global depression that rivaled what happened in the 1930s.
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Many in this community are still reeling from the effects of the recession -- and that followed a decade of struggle and growing economic insecurity for a lot of middle-class families. The truth is, even though the economy is growing and adding jobs again, it’s going to take a while to create the favorable conditions for communities like this one to rebound and to flourish. But what was clear when I walked through the Oval Office door, at a time of maximum peril in our economy, when economists were warning we might be going into a Great Depression, the financial system might be on the verge of collapse -- what was clear was that even though it might be difficult and even though some of the things we had to do might not be politically popular -– we had to act. We couldn’t accept a future that was marked by decline.
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And that’s why we took a series of steps to stop what was nothing short of an economic freefall. We passed a series of tax cuts to put more money in the pockets of working families right away -- including more than 12 million families in California. We increased the Pell Grant -- which brought 4 million additional dollars -- $4 million of additional aid to students right here in Fremont. We backed loans to small businesses -- including $20 million to companies in this community alone.
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We also provided relief for those hardest hit -- who not only needed help, but would most likely use the relief to generate more economic activity. So we extended unemployment benefits for more than 3 million California residents and made COBRA cheaper for people who’d lost their jobs so they could keep their health care for their families. We provided $250 in relief to more than 5 million California seniors -- many whose life savings had taken a big hit in the financial crisis. And we provided emergency assistance to our governors to prevent teachers and police officers and firefighters from being laid off as a result of state budget shortfalls. At a time when California is facing a fiscal crisis, we know that this has saved the jobs of tens of thousands of educators and other needed public servants just in this state. And what was true in California was true all across the country.
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So we recognized that we’ve got to go back to basics. We’ve got to go back to making things. We’ve got to go back to exports. We’ve got to go back to innovation. And we recognized that there was only so much government could do. The true engine of economic growth will always be companies like Solyndra, will always be America’s businesses. But that doesn’t mean the government can just sit on the sidelines. Government still has the responsibility to help create the conditions in which students can gain an education so they can work at Solyndra, and entrepreneurs can get financing so they can start a company, and new industries can take hold.
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But even as we are dealing with this immediate crisis, we’ve got to remember that the risks our current dependence on oil holds for our environment and our coastal communities is not the only cost involved in our dependence on these fossil fuels. Around the world, from China to Germany, our competitors are waging a historic effort to lead in developing new energy technologies. There are factories like this being built in China, factories like this being built in Germany. Nobody is playing for second place. These countries recognize that the nation that leads the clean energy economy is likely to lead the global economy. And if we fail to recognize that same imperative, we risk falling behind. We risk falling behind.
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Fifteen years ago, the United States produced 40 percent of the world’s solar panels -- 40 percent. That was just 15 years ago. By 2008, our share had fallen to just over 5 percent. I don’t know about you, but I’m not prepared to cede American leadership in this industry, because I’m not prepared to cede America’s leadership in the global economy.
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We’re also doing whatever it takes to help the men and women whose livelihoods have been disrupted and even destroyed by this spill -– everyone from fishermen to restaurant and hotel owners. So far the Small Business Administration has approved loans and allowed many small businesses to defer existing loan payments. At our insistence, BP is paying economic injury claims, and we’ll make sure that when all is said and done, the victims of this disaster will get the relief that they are owed. We’re not going to abandon our fellow citizens. We’ll help them recover and we will help them rebuild.
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So the thing that the American people need to understand is that not a day goes by where the federal government is not constantly thinking about how do we make sure that we minimize the damage on this, we close this thing down, we review what happened to make sure that it does not happen again. And in that sense, there are analogies to what’s been happening in terms of in the financial markets and some of these other areas where big crises happen -- it forces us to do some soul searching. And I think that’s important for all of us to do.
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As I said yesterday, the Small Business Administration has stepped in to help businesses by approving loans, but also as important, allowing many to defer existing loan payments. A lot of folks are still loaded up with loans that they had from Katrina and other natural disasters down here, so they may need some additional help.
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To deepen Russia’s integration into the global economy, I reaffirmed our strong commitment to Russia’s ascension to the World Trade Organization. Today we’ve reached an agreement that will allow the United States to begin exporting our poultry products to Russia once again. And I want to thank President Medvedev and his team for resolving this issue, which is of such importance to American business, and which sends an important signal about Russia’s seriousness about achieving membership in the WTO.
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And I think that we will be able to track a trajectory. And if that trajectory indicates that over the course of a year the RMB has appreciated a certain amount that is more in line in economic fundamentals, then I -- hopefully not only will that be good for the U.S. economy, that will also be good for the Chinese economy and the world economy.
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We are obviously still a huge part of the world economy. We are still going to be open. We are still going to be importing as well as exporting. But the economic realities are such that for us to see sustained global economic growth, all countries are going to have to be moving in some new directions.
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That was acknowledged in Pittsburgh. That means that surplus countries are going to have to think about how are we spurring domestic demand. That means that emerging countries are going to have to think are we only oriented towards exports, or are we also starting to produce manufacturing goods and services for the internal market. It means that deficit countries have to start getting serious about their midterm and long-term debt and deficits. And that includes the United States of America, which is why I've got a fiscal commission that's going to be reporting to me by the end of the year.
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So the point is not every country is going to respond exactly the same way, but all of us are going to have responsibilities to rebalance in ways that allow for long-term, sustained economic growth in which all countries are participating and, hopefully, the citizens of all these countries are benefiting.
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Now, there’s still a lot more that we can do to encourage trade and investment. And obviously in Russia -- and President Medvedev and I discussed this -- issues of transparency and accountability and rule of law remain absolutely critical. This is the foundation on which investments and economic growth depends. And I very much appreciate and applaud President Medvedev’s efforts in this area.
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Of course, ultimately, it’s you -— the private sector, our entrepreneurs -— who create jobs and unleash economic growth. It’s the market that’s been the most powerful force in history for creating opportunity and prosperity. It’s not the resources we pump or pull from the ground. It’s the imagination and the creativity of our people, our workers, and their dreams for themselves and their children that ultimately drives the modern economy.
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At the same time, we are all seated and back in Moscow, we were standing with Presidents. So it is easier to work. And this isn’t a significant difference, but speaking in serious term, during this year, we have changed a lot. The world economy has changed. And we were working very hard in order to improve the situation in our national economy in order to re-launch failed mechanisms in international economy. And certain persons present here just worked to save their businesses. In general, we managed to do so, although we did have problems.
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We will work personally and in the framework of the Presidential Commission established a while ago, but we also pin our hopes on the U.S.-Russia Business Dialogue established two years ago. We have representatives of this dialogue in this hall, and I’m very pleased that we are interacting on this topic and that eventually our joint projects will help us to overcome the difficulties threatening our economies, the world economy.
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We still have to do a lot -- to do a lot internationally and to do a lot with respect to our national legislations. President Obama is doing great work. We understand how difficult this work is because each solution has both persons who are in favor and who are against. But it is evident that the world economy and the world itself has changed. And we will have to change the rules, although everybody present in this hall are committed to modern economic approaches and are committed to a free market.
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Wall Street reform will also strengthen our economy in a number of other ways. We’ll make our financial system more transparent by bringing the kinds of complex deals that help trigger this crisis, like trades in a $600 trillion derivatives market, into the light of day. We’ll enact the Volcker Rule to make sure that banks protected by the safety net of the FDIC can’t engage in risky trades for their own profit. And we’ll create what’s called a resolution authority to help wind down firms whose collapse would threaten our entire financial system. No longer will be have companies that are “too big to fail”.
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We had an excellent conversation building off of the conversations that we’ve had at the G8 about the world economy and the importance of our two countries focusing both on the issues of growth, but also on the issues of financial consolidation, that we have long-term deficits that have to be dealt with and we have to address them.
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The G20 is now the premier forum for international economic cooperation. We represent East and West, North and South, advanced economies and those still emerging. Our challenges are as diverse as our nations. But together we represent some 85 percent of the global economy, and we have forged a coordinated response to the worst global economic crisis in our time.
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But as we all know, that’s not good enough. In the United States and around the world, too many people are still out of work. In too many economies, demand for goods and services is still too weak. As we’ve been reminded in recent months, a financial crisis in one country can have consequences far beyond its borders. And history teaches us that growth and prosperity is never guaranteed. It requires constant effort and it requires continued leadership.
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The second area we focused on was advancing the goal of financial reform. Just as we’re on the verge of passing financial reforms in the United States, our European partners have committed to the process we went through in the United States —- a new level of transparency and a stress test for banks to rebuild confidence.
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And I’m pleased we endorsed my proposal to broaden the G20 agenda to include the fight against corruption. In too many places, the culture of the bribe is a brake on development and prosperity. It discourages entrepreneurship, destroys public trust, and undermines the rule of law while stifling economic growth. With a new commitment to strengthening and enforcing rules against corruption, economic opportunity and prosperity will be more broadly shared.
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And we have set up this fiscal commission who will provide reports starting in November -- and one of the encouraging things, although there was resistance, ironically, on the part of some of the Republicans who originally had been co-sponsors of legislation to create the fiscal commission and they, in fact, ended up voting against it -- what’s been encouraging, based on what I’m hearing both from Democrats and Republicans, is that there’s been a serious conversation there. People are looking at a whole spectrum of issues to get at what is basically a structural deficit that preceded this financial crisis.
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We’re having breakfast this morning because the friendship between Indonesia and the United States has always been strong, and it is our intention to continue to make it even stronger. Working within the G20, we have been able to stabilize the world economy. I was just hearing from the President the progress that's been made in getting back to pre-crisis levels in Indonesia with respect to economic growth and employment, inflation. But obviously, we have many challenges that still have to proceed.
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But what we also agreed is that we’ve still got a lot of work to do. There is a great concern about the 8 million jobs that were lost during the course of these last two years, and that we’ve got to continually push the pace of economic growth in order to put people back to work. That ultimately is the measure for most Americans of how well the economy is doing.
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Not only will completion of the financial regulatory reform bill provide some certainty to the markets about how we are going to prevent a crisis like this from happening again, but it also ensures that consumers are going to be protected like never before on all the things day to day that involve interactions with the financial system. From credit card debt to mortgages, consumers are going to have the kinds of protections that they have not had before.
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So, overall, I think that, listening to Chairman Bernanke, I continue to be convinced that with financial regulatory reform in place, with a recovery well underway, that we have enormous potential to build on the hard work that’s been done by this team and put people back to work and keep this recovery and the economy growing over the next several years.
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I’m confident that given the package that has been put together, that senators, hopefully on both sides of the aisle, recognize it’s time we put in place rules that prevent taxpayer bailouts and make sure that we don’t have a financial crisis that can tank the economy. And I think there’s going to be enough interest in moving reform forward that we’re going to get this done.
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I hear worries like this all the time -- from folks that I talk to in town halls like this, but also in the letters that I read each night from all across the country. And it’s frustrating and often it’s heartbreaking. And that’s why even though there’s -- there are plenty of challenges on our plate -- everything from Afghanistan to Iran to the oil spill, all critical issues that go to our long-term prosperity and security -- nothing is more important than reversing the damage of the great recession and getting folks back to work.
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And that’s why I’ve been fighting, in addition to everything we’ve done, for additional steps to speed up this recovery and keep the economy growing. We want an extension of unemployment benefits for workers who lost their job through no fault of their own. We want to help small business owners get the loans they need to keep their doors open and hire more workers. We want relief for struggling states so they don’t have to lay off thousands of teachers and firefighters and police officers.
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Now, you’d think this would be pretty straightforward stuff, but I’ve got to say that lately we’ve been having to wrangle around what used to be pretty noncontroversial things -- providing loans for small businesses, extending unemployment insurance when 8 million people lost their jobs during the recession. But lately, there’s a minority of senators from the other party who’ve had a different idea. As we speak, they are using their power to stop this relief from going to the American people. And they won’t even let these measures come up for a vote. They block it through all kinds of procedural maneuvering in the Senate.
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On Wall Street, the financial industry and its lobbyists spent years chipping away at rules and safeguards that could have prevented the meltdown of -- that caused -- that was caused by Lehmann Brothers and AIG. But we didn’t have those rules in place, that framework of regulation in place. So instead, we saw a disaster that nearly led to the collapse of the entire economy.
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And there have always been those who said no to these policies and these ideas. I mean, you look back on the history books. There were people who said that Social Security was socialism, said that Medicare was a government takeover. There were automakers who said that installing seat belts was unnecessary, unaffordable, and would ruin the auto industry. There were skeptics who thought that cleaning our water and our air would bankrupt our economy. Right here in Wisconsin -- if you look at the lake now and look at the lake, what it was like 30 years ago, 40 years ago. And there were people who said, well, there’s nothing we can do about all the sludge and drudge and whatever is going on in there.
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He can't be that out of touch with the struggles of American families. And if he is, then he’s got to come here to Racine and ask people what they think. Do you think we should fix -- I mean, maybe I'm confused. Do you think that the financial crisis was an ant and we just needed a little ant swatter to fix this thing? Or do you think that we need to restructure how we regulate the financial system so you aren’t on the hook again and we don't have this kind of crisis again?
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When you ask men and women who have been out of work for months at a time, who talk about how they’ve been barely hanging on, they don't think this financial crisis was something where you just need a few tweaks. They know it’s what led to the worst recession since the Great Depression. And they expect their leaders in Washington to do whatever it takes to make sure a crisis like this doesn’t happen again. And so there may be those in Washington who want to maintain the status quo, but we want to move America forward.
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So already -- already we’ve provided entrepreneurs and small business owners with tax credits and loan guarantees that’s led to 720,000 clean energy jobs -- will lead to over 700,000 jobs in 2012. These are good-paying, middle-class, American jobs. I’ve seen them. I’ve gone to wind turbine plants where they’re creating wind turbines, and gone to solar plants where they’re making the latest generation of solar panels. And we’ve created an entire new advanced battery industry here in the United States. So where we were only getting 2 percent of that market, we’re now going to be getting 40 percent of that market. That was all done through the Recovery Act.
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Okay. You know, one of the -- obviously part of what triggered this entire crisis was what was going on in the mortgage industry. American homeownership -- that's always been such an important symbol of the American Dream, right? Having your own home. And so I think that part of what’s happened over the years was it was easier and easier to get a mortgage. And some of that was good, but unfortunately what you started seeing were what were called these sub-prime loans.
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Now, we have been able to settle the markets down and stabilize them so that now it’s possible for people to get mortgages and get auto loans and it’s possible for businesses to get credit -- although small businesses are still having a problem. But that underlying problem of the housing market is still there.
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Now, here’s the last point I want to make, last point I want to make. Having said all that, I'm still not satisfied with where we’re at. We're growing at about 2.5, 3 percent growth. We need to be growing at 4 percent or 5 percent. So there are still more things we can do. I mentioned a couple of them. We should pass a bill that helps small businesses get more loans. If we can help the big banks, then we should certainly be able to help small business lending. And a lot of small businesses are still having trouble getting credit. We've done some work on that, but we can do more.
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And that's a legitimate question. And whether you're a Democrat, an independent, or a Republican, all of us should be worried about the fact that we have been running the credit card on -- in the name of future generations. And somebody is going to have to pay that back. And by the way, when we borrow all that money, we have to pay interest on that -- to other countries and other investors. So we've got to get our debt and our deficits under control.
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Well, it’s a great question. Well, this actually connects to the previous question, because I was talking about what we were doing for the emergency, what we were doing for the local economy. But obviously now we live in a global economy. So we've got to compete with other countries like we've never had to compete before.
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And then we’ve got to put more money into research and development, because ultimately the jobs that are being created here are going to be created by small businesses, by start-ups, by entrepreneurs who’ve got a new idea. And we’ve got to make sure that -- we’ve got make sure that we’re investing in research on things like clean energy, so that’s another aspect of it.
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A couple other elements -- in terms of our tax structure, one of the things that we’ve done -- one of the things we proposed was eliminating the capital gains tax for small businesses, because small businesses create businesses -- or create jobs. Start-ups create jobs. So there are things we can do with the tax structure that encourages more job creation.
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Today’s historic Kabul Conference is another major step forward. The Afghan government presented —- and its international partners unanimously endorsed —- concrete plans to implement President Karzai’s commitments to improve security, economic growth, governance, and the delivery of basic services. The Afghan government presented its peace and reconciliation plan —- which the United States firmly supports. Agreement was reached on a plan in which responsibility for security in Afghan provinces will transition to Afghan security forces. In addition, Afghanistan and Pakistan reached a historic agreement to increase economic opportunity for people on both sides of the border.
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But I can assure you this, that my administration is squarely committed not just to dealing with the short-term deficit and debt -- which in some ways is the least troubling aspect of this problem -- what we’re going to have to tackle are some big structural reforms that are going to be tough. And they're going to be that much tougher because we’re coming out of a recession as we do it. But I think that as we continue to see economic growth, as we continue to see the economy heal from last year, that the American people are going to want to approach this problem in a serious, realistic way. We owe it for the next generation.
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Now, while a number of factors led to such a severe recession, the primary cause was a breakdown in our financial system. It was a crisis born of a failure of responsibility from certain corners of Wall Street to the halls of power in Washington. For years, our financial sector was governed by antiquated and poorly enforced rules that allowed some to game the system and take risks that endangered the entire economy.
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Now, let’s put this in perspective. The fact is, the financial industry is central to our nation’s ability to grow, to prosper, to compete and to innovate. There are a lot of banks that understand and fulfill this vital role, and there are a whole lot of bankers who want to do right -- and do right -- by their customers. This reform will help foster innovation, not hamper it. It is designed to make sure that everybody follows the same set of rules, so that firms compete on price and quality, not on tricks and not on traps.
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Now, for all those Americans who are wondering what Wall Street reform means for you, here’s what you can expect. If you’ve ever applied for a credit card, a student loan, or a mortgage, you know the feeling of signing your name to pages of barely understandable fine print. What often happens as a result is that many Americans are caught by hidden fees and penalties, or saddled with loans they can’t afford.
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So, all told, these reforms represent the strongest consumer financial protections in history. In history. And these protections will be enforced by a new consumer watchdog with just one job: looking out for people -– not big banks, not lenders, not investment houses -– looking out for people as they interact with the financial system.
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Now, beyond the consumer protections I’ve outlined, reform will also rein in the abuse and excess that nearly brought down our financial system. It will finally bring transparency to the kinds of complex and risky transactions that helped trigger the financial crisis. Shareholders will also have a greater say on the pay of CEOs and other executives, so they can reward success instead of failure.
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The fact is every American -– from Main Street to Wall Street –- has a stake in our financial system. Wall Street banks and firms invest the capital that makes it possible for start-ups to sell new products. They provide loans to businesses to expand and to hire. They back mortgages for families purchasing a new home. That’s why we’ll all stand to gain from these reforms. We all win when investors around the world have confidence in our markets. We all win when shareholders have more power and more information. We all win when consumers are protected against abuse. And we all win when folks are rewarded based on how well they perform, not how well they evade accountability.
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In the end, our financial system only works –- our market is only free –- when there are clear rules and basic safeguards that prevent abuse, that check excess, that ensure that it is more profitable to play by the rules than to game the system. And that’s what these reforms are designed to achieve -- no more, no less. Because that’s how we will ensure that our economy works for consumers, that it works for investors, that it works for financial institutions -– that it works for all of us.
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This isn’t just about lines on a spreadsheet or numbers in a budget, because when we fail to spend people’s tax dollars wisely, that’s money that we’re not investing in better schools for our kids, or tax relief for families, or innovation to create new industries and new jobs. When government doesn’t work like it should, it has a real effect on people’s lives -– on small business owners who need loans, on young people who want to go to college, on the men and women who’ve served this country and are trying to get the benefits that they’ve earned. And when we continue to spend as if deficits don’t matter, that means our kids and our grandkids may wind up saddled with debts that they’ll never be able to repay.
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First, I signed a Wall Street reform bill that will protect consumers and our entire economy from the recklessness and irresponsibility that led to the worst recession since the Great Depression. It’s a reform that will help us put a stop to the abusive practices of mortgage lenders and credit card companies, and ensure that people get the straight, unvarnished information that they need before they take out a loan or open a credit card. It will bring the shadowy deals that caused the financial crisis into the light of day. And it will end taxpayer bailouts of Wall Street firms and give shareholders a say on executive compensation.
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But ultimately, our goal is to make sure the people who are looking for a job can find a job. And that's why it’s so important for the Senate to pass the additional steps that I’ve asked for to cut taxes and expand lending for America’s small businesses, our most important engine for hiring and for growth. And a small business jobs bill that contains these measures may come up for a final vote in the Senate in the next few days.
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With this small business bill, we’ll set up a new lending fund to help community banks offer small businessmen and women the loans they need to grow and to hire. We’ll help states encourage more private sector loans to small businesses in industries like manufacturing or construction that have been especially hard hit by this recession. We’ll expand our most successful small business initiatives and more than double the size of loans our small business owners can take out.
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Now, last night, after a series of partisan delays, the Senate took an important step forward by supporting a lending fund in the overall small business jobs bill. I want to thanks Senators Mary Landrieu and George Lemieux for their leadership and advocacy on behalf of the millions of small business people for whom this will make a meaningful difference. I was heartened that Senator LeMieux and Senator George Voinovich crossed party lines to help pass this lending provision last night, and I hope we can now finish the job and pass the small business jobs plan without delay and without additional partisan wrangling.
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So HHS Secretary Kathleen Sebelius and HUD Secretary Shaun Donovan have worked together to improve access to affordable housing and community supports and independent living arrangements for people with disabilities. And we continued a program that successfully helps people with disabilities transition to the community of their choice. And I’m proud of the work that the Department of Justice is doing to enforce Olmstead across the country.
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Now, you’d think that making these reforms would be a matter of common sense, particularly since they primarily involve just making sure that folks who are financing these ads are disclosed so that the American people can make up their own minds. Nobody is saying you can’t run the ads -- just make sure that people know who in fact is behind financing these ads. And you’d think that reducing corporate and even foreign influence over our elections would not be a partisan issue. But of course, this is Washington in 2010. And the Republican leadership in the Senate is once again using every tactic and every maneuver they can to prevent the DISCLOSE Act from even coming up for an up or down vote. Just like they did with unemployment insurance for Americans who’d lost their jobs in this recession. Just like they’re doing by blocking tax credits and lending assistance for small business owners. On issue after issue, we are trying to move America forward, and they keep on trying to take us back.
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I believe that starts with doing everything we can to support small businesses. These are the stores, the restaurants, the start-ups and other companies that create two out of every three new jobs in this country -- and that grow into the big businesses that transform industries, here in America and around the world.
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These are the kind of common-sense steps that folks from both parties have supported in the past -- steps to cut taxes and spur private sector growth and investment. And I hope that in the coming days, we’ll once again find common ground and get this legislation passed. We shouldn’t let America’s small businesses be held hostage to partisan politics -- and certainly not at this critical time.
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Well, I just had a terrific meeting with these small business owners here at Tastee Sub Shop. And I want to thank Dave and Carl for hosting us here today. And I highly recommend everybody buy a sandwich while you’re here, although as I said before, I can’t eat a 12-inch these days, now that I’m 49 -- well, I will be in a week.
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This town, Edison, is named after somebody who was not only one of history’s greatest inventors but also a pretty savvy small business owner. And the small business people who are here with me today exemplify that same entrepreneurial spirit. And all of these companies have seen their share of challenges. All of these small business owners have had to improvise and adapt over the years, especially in tough times, and that includes over the last couple years.
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So Tom and Catherine Horsburgh were telling me that they got through the downturn. In order to do so, they had to market their products to types of businesses that they hadn’t sold to before. Brian Bovio’s company had to let some people go when the recession hit. But in the two years since, he’s transformed his business, and now he’s making people’s homes more energy efficient to save money on their utility bills -- and he’s been able to start hiring again. He is very interested in making sure that the HOMESTAR proposal that we’ve put into Congress actually passes, because not only will that help to expand his business but it’s also going to help Americans save energy not only in this part of the country but all across the country.
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Now, all of this hasn’t been easy. The recession has meant that folks are spending less. It means that small businesses have had a tougher time getting credit and getting loans. And that’s why when I took office, we put in place an economic plan specifically to help small businesses. And we were guided by a simple idea: Government can’t guarantee success, but it can knock down barriers that keep entrepreneurs from opening or expanding. For example, the lack of affordable credit -- that’s something the government can do something about. Government can’t replace the millions of jobs that we lost in the recession, but it can create the conditions for small businesses to hire more people through steps like tax breaks.
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That’s why we’ve cut taxes for America’s small businesses eight times. Eight times have we cut taxes for small businesses all across the country. Because of a bill I signed into law a few months ago, businesses are now eligible for tax cuts when they hire unemployed workers -- something that could benefit every business represented behind me. Companies are also able to write off more of their investments in new equipment, which Tom and Catherine have taken advantage of. As part of the health reform package, 4 million small business owners recently received a postcard in their mailbox telling them that this year they could be eligible for a health care tax credit that’s worth perhaps tens of thousands of dollars.
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Our economic plan has also supported nearly 70,000 new loans to small businesses. One of these loans made it possible for Tom and Catherine to purchase new equipment. We’ve waived fees on new SBA loans to save folks money on payments. And that reduced Theo’s costs when he opened his new restaurant. His family had a business, a family restaurant. He opened his own and it saved him more than $20,000 in waived fees -- money that’s now gone into that new restaurant and its 60 new employees.
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So all told, these and other steps are making a difference. But when you listen to the struggles that small business owners are still facing, it’s clear that we need to do more. And that’s why I’m urging the Senate to approve a jobs bill that will do two big things for small businesses: cut taxes and make more loans available. That’s what Dave and Carl and Theo and Brian and Tom and Catherine tell me they can use. And that’s what I’ve heard from small businesses all across America.
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This bill will also make more credit available. Everywhere I go, I hear from small business owners who simply cannot get the credit they need to hire and expand. And we’ve been hearing from smaller community banks that they want to lend to these folks but need more capital to do it. So the initiatives in this bill will help them meet those challenges. And it will increase -- allow them to increase loan sizes, and make sure that we continue to waive fees for SBA loans that have helped a number of the people standing behind me.
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Now, let me just make one last point. I know it’s no secret that we’ve confronted a lot of partisan politics over the past year and a half. We’ve seen a fair amount of obstruction that’s had more to do with gaining political advantage than helping the country. But surely, Democrats and Republicans ought to be able to agree on this bill. When I had a conversation with Mitch McConnell and John Boehner yesterday, I told them that the provisions of this bill are things that the Republican Party has said it’s supported for years: helping small businesses, cutting taxes, making credit available. This is as American as apple pie. Small businesses are the backbone of our economy. They are central to our identity as a nation. They are going to lead this recovery. The folks standing beside me are going to lead this recovery.
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The last time I spoke with you was during your Orlando conference in August -- got Orlando in the house. Orlando conference back in August of 2008. I didn’t have any gray hair back then. Say that's all right? But I want to remind you what things were like in August of 2008. Our economy was in freefall. We had just seen seven straight months of job loss. Foreclosures were sweeping the nation. And we were on the verge of a financial crisis that threatened to plunge our economy into a second Great Depression.
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We’ve also included a permanent reauthorization of the Indian Health Care Improvement Act in the health care reform legislation we passed this spring. We’re strengthening Tribal education. We’re working to spur economic development throughout Indian Country. And in consultation with Indian tribes, we’re now formally reviewing the United Nations Declaration on the Rights of Indigenous Peoples. And after 14 long years, we’ve finally settled the Cobell case and we’re working with Congress to get the settlement approved as quickly as possible.
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Listen, before I just make a few short remarks, I just want to acknowledge some people who are here who have been critical in helping make sure that we are putting the U.S. auto industry back on track. First of all, my Secretary of Transportation Ray Lahood, from Peoria, Illinois, is here. The mayor of Hamtramck, Karen Majewski, is here. Give her a big round of applause.
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You know, it is great to be back here and to see this outstanding plant and to see all of you. And I want to take you down Memory Lane just a little bit to a year ago. At that point, we were coming out of the worst recession that we had seen since the Great Depression. The economy was shrinking. We had lost 8 million jobs. The day I was sworn in, we lost -- that month, we lost 750,000 jobs -- that month that I was sworn in. That's true.
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The auto industry had lost hundreds of thousands of jobs. Sales had gone down by 40 percent. And two of the Big Three, GM and Chrysler, were on the brink of a liquidation bankruptcy, which means they would have been wiped out. And if GM and Chrysler were wiped out, then suppliers would be wiped out and dealerships would have been wiped out, and communities would have been even more devastated.
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It’s estimated that we would have lost another million jobs if we had not stepped in. Now, we basically had three options when I was confronting what was happening in the U.S. auto industry. Option number one was to keep on doing what the previous administration had been doing, which is basically give about a billion dollars a month to the auto industry, but not really ask for any kind of change that would get it on the right track.
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And now here we are a year later. And a year later, GM and Chrysler, along with Ford, are all posting a profit. The U.S. auto industry has hired 55,000 workers, the most job growth in a decade. And not only that, but you’re producing the cars of the future right here at this plant, producing cars that are going to reduce our dependence on foreign oil. This car right here doesn’t need a sip of gasoline for 40 miles and then keeps on going after that.
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Now, let’s be clear, we’re not out of the woods yet. The economy is now growing -- it was shrinking at 6 percent. Now, it’s growing at 2.4 percent. We’ve added private sector jobs for six months in a row, but there’s still too many folks unemployed. There are a lot of folks in the auto industry who haven’t been hired back. We’re still going to have to do a lot of work to put folks back to work.
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We are back on our feet. We are on the move. GM is on the move. The U.S. auto industry is on the move. And America is on the move, and I’m not going to rest until every single American worker who wants to get back to work is going to be back to work. You're helping lead the way and I’m grateful to you!
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We’ve got some special guests here that I want to acknowledge. First of all, your Secretary of Transportation, who has helped to make sure that we are guiding this process of rebuilding the American auto industry and is doing an outstanding job, from Peoria, Illinois, Secretary Ray Lahood. Give him a big round of applause.
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I wasn’t used to that. Had all these -- everything was electronic, and I had -- all my -- I’d had to roll up my windows up until that point. So I’ve got some good memories of that car. But I’ve got to tell you when I sat in this car, this is a better car. This is a state-of-the-art car. This is a world-class car right here.
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In the 12 months before I took office, the American auto industry lost hundreds of thousands of jobs. Sales plunged 40 percent. Think about that. The industry looked like it was going over a cliff. As the financial crisis and the vicious recession collided with an industry that for too long had avoided hard choices and hadn’t fully adapted to changing times, we finally reached the point where two of the Big Three -- Chrysler and GM -- were on the brink of liquidation.
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And that left us with very few choices. One choice, one option was to keep the practice of giving billions of dollars of taxpayer money to the auto industry but not really forcing any accountability or change -– so you just keep on kicking the tough problems down the road year after year and hopefully seeing if you can get more and more money out of Washington.
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Last year, many thought this industry would keep losing jobs, as it had for the better part of the past decade. Today, U.S. automakers have added 55,000 jobs since last June, the strongest job growth in more than 10 years in the auto industry. This plant just hired a new shift of 1,100 workers last week.
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So there’s no doubt that the auto industry is growing stronger. But, look, the hard truth is this industry lost a lot of jobs in recent years. Some of those jobs aren’t coming back partly because automakers have become so much more efficient than they used to be. This is a lean, mean operation. And so there are people who have still lost their jobs, haven’t been hired back and it wasn’t their fault. Mistakes were made in managing the company that weren’t theirs.
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I want you to remember, though, if some folks had their way, none of this would have been happening. I just want to point that out. Right? I mean this -- this plant -- this plant and your jobs might not exist. There were leaders of the “just say no” crowd in Washington -- they were saying -- oh, standing by the auto industry would guarantee failure. One of them called it “the worst investment you could possibly make.”
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So, with the closure of the well we mark an important milestone. But this is not the end of the journey. And in completing the work ahead I'm reminded of what I heard when I was in Louisiana back in June. I spent time with folks on Grand Isle, meeting with fishermen and small business owners, and the town's mayor, David Camardelle. And he told me what his friends and neighbors were going through. He talked about how hard things had been. But he also explained the way folks rallied to support one another, and said, the people in this community may not have a lot of money, but that didn’t matter. "We help each other," he said. "That's what we do."
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Now, that’s not easy. We’ve been through a terrible recession -– the worst that we’ve seen since the Great Depression. And this recession was the culmination of a decade that fell like a sledgehammer on middle-class families. For the better part of 10 years, people were seeing stagnant incomes and sluggish growth and skyrocketing health care costs and skyrocketing tuition bills, and people were feeling less secure economically.
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And few parts of the economy were hit harder than manufacturing. Over the last 10 years, the number of people working in manufacturing shrank by a third. And that left millions of skilled, hardworking Americans sitting idle, just like the plants were sitting idle. That was before the recession hit. Obviously once the recession took hold, millions more were struggling in ways that they never imagined. And there’s nobody here who hasn’t been touched in some way by this recession. And certainly a state like Wisconsin or my home state of Illinois can tell a lot of stories about how badly hit manufacturing was, particularly in the Midwest.
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We’ve cut taxes for small businesses that hire unemployed workers. In fact, I’ve signed seven other small business tax cuts so that entrepreneurs can help expand and buy new equipment and add more employees. We’ve taken emergency steps to prevent layoffs of hundreds of thousands of teachers and firefighters and police officers, and other critical public servants in our communities. And I think that Governor Doyle will testify that we have made progress in part because everybody has pulled together. There was a great danger of even greater layoffs all across this state for vital services that would affect our kids and our families. These folks would have otherwise lost their jobs because of state and local budget cuts.
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We expect our commitment to clean energy to lead to more than 800,000 jobs by 2012. And that’s not just creating work in the short term, that’s going to help lay the foundation for lasting economic growth. I just want everybody to understand --just a few years ago, American businesses could only make 2 percent of the world’s advanced batteries for hybrid and electric vehicles -- 2 percent. In just a few years, we’ll have up to 40 percent of the world’s capacity.
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Our choice in this election is between policies that encourage job creation in America, and policies that encourage job creation someplace else. So instead of giving tax breaks to companies that ship jobs overseas, we want to cut taxes for small business owners who create jobs right here in the United States of America.
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And these ideas shouldn’t be Democratic or Republican ideas. They are common-sense ideas. And yet, most of the Republicans in Congress voted no on just about every one of these policies. Do you remember when I was running, we had a little slogan -- “Yes, we can.” These guys’ slogan is, “No, we can’t.” No on closing loopholes for companies that ship jobs overseas. No on the tax cuts for small businesses. No on the clean energy jobs. No on the railroad and highway projects.
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Think about this. We had the worst financial crisis since the Great Depression, almost resulted in a complete meltdown -- 8 million jobs lost. And when we try to repair the system to maintain innovation in the financial system, but to make sure that people have some idea what kind of mortgage they’re buying, or what kind of credit card interest is being charged, or making sure that if one bank goes down, taxpayers don’t have to bail it out in order to ensure that the whole system goes down -- they said, no.
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Same thing with the financial system. We can’t go back to a status quo that almost brought this country to its knees. We’ve got to move forward so that, in fact, you now know what credit card companies are charging you for interest, and mortgage companies can't steer you to the more expensive interest rate on your mortgage, and there will not be taxpayer bailouts.
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That can’t be the kind of leadership that we need going into the 21st century. We can’t go backwards. We have to move forward. That’s what’s at stake in this election. If we give them the keys to this economy, they are going to drive it right back into the ditch. And riding shotgun will be the big banks and the insurance companies and the oil companies and every special interest under the sun.
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And I want to be very clear here. I want businesses in this country to succeed. And the vast majority of folks out here who are running a business, they are doing what’s right by their communities and their workers. And I want to do everything we can to help you grow and to prosper and hire more employees. We just came back from a company that's building advanced batteries right here in this region, hiring more employees, and we are giving them all the help we can.
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A few weeks ago, I had the opportunity to visit a Chrysler plant in Detroit. Now, this is a place that’s been hit harder by recession than almost anywhere else in the country. The auto industry alone lost hundreds of thousands of jobs in the year before I took office -- obviously some of those jobs were lost here in Wisconsin. We had to make a very difficult decision when I was President about whether to walk away from U.S. automakers or help them get back on their feet. And we decided we could not walk away from up to a million jobs and an iconic industry that symbolizes the rise of American manufacturing. And so we told the automakers, we’ll give you some temporary assistance, but you’ve got to restructure your plants so they can finally compete in the 21st century.
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And we’ve got a track record. Right now we’ve got a bill pending to provide tax breaks, including the elimination of capital gains for small start-up businesses. We’ve been debating this thing how long now? Six months, a year. And these guys still aren’t going for it. The Chamber of Commerce is for it. You know? Now, they usually don’t side with me on a lot of things -- although they sided with me on the Recovery Act and they’ve conveniently forgot about that.
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Tiffany Turner and her husband Brady gave up their careers in teaching and insurance to open their own inn on the coast. And despite the recession, business has been good. They’re even looking to expand and hire new employees. For a time, their community bank couldn’t give them the loan they needed to grow, but recently that changed. In fact, many banks like theirs have begun to open the flow of credit to small businesses for the first time in four years, and that’s good news.
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Fugere -- see, I thought I had it right -- put everything on the line -– his savings, his 401(k), even a second mortgage -– to open his first pizzeria. With a little hard work, it succeeded. And he opened two more. After the crisis hit, he sought a loan to open a fourth because business was good. But at bank after bank, Joe heard “no.” The same big banks whose reckless actions nearly brought down the economy told Joe that loaning money to a restaurant -– even one as successful as his -– was “too risky.” Finally, a community bank invested in Joe, and his fourth restaurant has been his most successful opening yet. And recently, an SBA loan under the Recovery Act helped him to improve his cash flow.
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Stories like this are at the core of the American experience. This has always been a country where anyone with a good idea and the guts to see it through can succeed. It’s what gives a worker the courage to leave her job to become her own boss, or somebody with a dream to risk it all on a great idea. But these are tough times for a lot of small business owners. The financial crisis has made it particularly difficult for them to get the loans they need to grow. The recession has meant that folks are spending less. And across the country, many small businesses that were once the beating heart of the community are now empty storefronts haunting our main streets.
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And that’s why, when I took office, we put in place an economic plan to help small businesses. And Patty Murray was there every step of the way in us putting forward these initiatives. At its heart was a simple idea: While government can’t guarantee their success, government can knock down the barriers that stand in the way and help create the conditions to help small businesses grow and to hire.
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And that’s why we’ve passed eight tax cuts for America’s small businesses. Tax cuts for hiring unemployed workers. Tax cuts for investing in new equipment. As part of health insurance reform, 4 million small business owners recently received a postcard in their mailboxes telling them that they could be eligible for a health care tax credit worth perhaps tens of thousands of dollars. And I know that Tiffany and her husband are looking now about the possibility, because of these incentives, to be able to maybe provide health insurance to their workers. Under the Recovery Act, we supported nearly 700 -- nearly 70,000 new loans to small businesses like Joe’s, and we waived fees on new SBA loans so people like Joe save money -- up to $20,000 with the SBA arrangement that Joe had.
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These steps and others are making some difference. But when you listen to these three business owners and you talk to small business owners across the country, it’s clear that we’ve got to do more. And that’s why I’m urging the Senate once again to approve a jobs bill that will do two big things for small businesses: cut more taxes and make available more loans. That’s what folks like the three people standing behind me say would be helpful. That’s what I’ve heard from small business owners across America.
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Joe and Tiffany could tell you firsthand just how critical community banks are to helping small businesses grow and create jobs. Well, this bill will help those banks access more capital so they can offer more small businesses the loans that they need. It will make sure we continue to waive some of the fees for SBA-backed loans. It will increase deductions small businesses can take for new equipment and other expenses. And it will finally do what I’ve championed since I ran for President, and that’s eliminate capital gains taxes on investments in small businesses.
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Now, unfortunately, a partisan minority in the Senate has been standing in the way of giving our small businesspeople a simple up-or-down vote on this bill. They won’t even let it go to vote. And every day this obstruction goes on is another day a small business somewhere in the country can’t get a loan or can’t get the tax cuts that it needs to grow and to hire.
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I think Patty would agree with me when I say there will be plenty of time between now and November to play politics, but the small business owners beside me and around the country don’t have time for political games. They’re not interested in what’s best for a political party. They’re interested in what’s best for their employees and their communities and for the country.
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So when Congress reconvenes, this jobs bill will be the first business out of the gate, and I ask Senate Republicans to drop their efforts to block it. I believe we can work together to get this done for the folks standing beside me, and for small businesses, their employees, and communities that depend on them all across the country.
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Instead of giving tax breaks to companies that are shipping jobs overseas, we want to cut taxes for companies that create jobs right here in the United States of America. We want to give tax cuts to small business owners. We want to give tax breaks to clean energy companies. We also want to make sure that we keep taxes low for middle-class families, and that’s why we cut taxes for 95 percent of workers right at the beginning of my term -- because they had been going through a tough time and they needed to have a chance to deal with this economic crisis.
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And we’re helping the U.S. auto industry get back on its feet and retool for the 21st century. This was an industry that lost hundreds of thousands of jobs in the year before I took office -- and were getting bailouts but never asked to restructure to figure out how they could compete. So we had to make some tough decisions about whether to help them out or walk away from possibly a million jobs. And I decided we couldn’t walk away. And, by the way, this was not very popular.
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Patty was in the lead on all these measures. And all these reforms make America more competitive in the 21st century. They move us forward. And on each of these reforms, we reached out to Democrats and Republicans for ideas and support. But in just about every instance -- I’m sure there’s an exception that's escaping my mind -- in almost every instance, Republicans in Congress said no. No on help for small businesses. No on middle-class tax cuts. No on clean energy jobs. No on making college more affordable. No on Wall Street reform.
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Name me an issue. They voted to keep giving tax breaks to corporations that ship jobs overseas. They voted to give insurance companies the power to keep denying coverage to people who are sick. The top Republican on the Energy Committee actually apologized to BP for us making sure the $20 billion was secured to help fishermen and small businesspeople in the Gulf whose livelihoods were almost decimated. This guy called it a shakedown -- I think he said “Chicago shakedown,” just to kind of underscore it. Apologized to BP.
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So I need you to join me, and I need you to join Patty, in building a future where our small businesses flourish on the power of their ideas and ingenuity. A future where clean energy powers not just America, but powers the world, produced in the fields and factories of the United States. A future where our children get the education and training they need to compete with anyone and anywhere. I want to build a future where we recapture a sense of optimism and confidence -- hope that’s made America a beacon to the world.
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But what we have to remind ourselves is that same month that I was sworn in, we lost 800,000 jobs. We had lost 3 million jobs in the previous six months. And we would lose another several million jobs in the next three months before any of our economic policies had a chance to actually take root. So altogether, we lost 8 million jobs. The financial system was on the verge of meltdown, and most economists thought that there were decent odds we might tip into the next Great Depression.
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Because of the swift action that we took, we were able to stabilize the economy and stabilize the financial system. But that was not just because we drafted a whole bunch of clever plans on paper. We had to move all that stuff through Congress. And that brings me to your senior senator, Patty Murray.
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We revamped our student loan system so that, instead of sending tens of billions of dollars to the banks as middlemen for guaranteed loans where they were taking no risk, we were able to cut out the middleman. And now millions more young people here in Washington State and all across the country are going to be able to get assistance to go to college, which means they’re going to be able to go to work for Microsoft or all these other wonderful companies that are up here. And we’ll be able to maintain our cutting edge -- which reminds me we also made the largest investment in research and development in our history -- because the essence of America is innovation and entrepreneurship and technological leadership.
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Now, we’ve still got a lot of work to do. The economy is stabilized, but it’s stabilized at a very weak level. So Patty and I just had some lunch with some wonderful small businesspeople who were talking about how it’s still difficult for small businesses to access credit, which is why we’ve got initiatives in the Senate right now to make sure that small community banks are able to provide lending to small businesses. We want to cut taxes smartly -- so, for example, eliminating capital gains taxes on investments in start-up businesses.
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So all these things have made a difference. But we still have got a long way to go. And so a couple of things that we’re focused on right now is, number one, making sure that small businesses are getting help, because small businesses like Joe’s architectural firm are really the key to our economy. They create two out of every three jobs. And so we want to make sure that they’re getting financing. We want to make sure that we are cutting their taxes in certain key areas. One of the things that we’ve done, for example, is propose that we eliminate capital gains taxes on small businesses so that when they’re starting up and they don't have a lot of cash flow, that's exactly the time when they should get a break and they should get some help.
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Now, one of the things that I think people may not be aware of is that although this exchange isn’t going to be set up until 2014 -- because it takes a while, we’ve got to set it up right -- there’s some immediate things that are helping right now. If your child has a preexisting condition, insurance companies, starting this year, will not be able to deny those children coverage. And that’s a big deal for a lot of folks whose children may have diabetes or some other illness and right now can’t get insurance. Insurance companies are going to have to provide them insurance. That’s number one.
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I have been adamant in saying that Social Security should not be privatized and it will not be privatized as long as I'm President. And here’s the reason. I was opposed to it before the financial crisis. And what I said was the purpose of Social Security is to have that floor, that solid -- rock-solid security, so that no matter what else happens you’ve always got some income to support you in your retirement. And I've got no problem with people investing in their 401(k)s, and we want to encourage people to invest in private savings accounts. But Social Security has to be separate from that.
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We have 2 percent of the entire market -- 2 percent. By 2015, in five years, we’re going to have 40 percent of that market because of the investments that we made. So one of the advanced battery manufacturing plants that we helped get going with some key loans and support and tax breaks, they’re now putting those batteries into the Chevy Volt. And you combine it then with an entire new U.S. auto industry that is cleaner and smarter and has better designs and is making better products -- those are potentially thousands, tens of thousands, hundreds of thousands, of manufacturing jobs. And the Midwest is really poised to get a lot of those jobs. In a town like Toledo where you’ve still got a lot of skilled workers, they are poised to be able to take off on that. But we’ve got to continue to support it.
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The other area that I’ve already mentioned is infrastructure. We’ve got about $2 trillion worth of infrastructure improvements that need to be made all across the country -- roads, bridges, sewer lines, water mains. It’s crumbling. The previous generation made all these investments that not only put people to work right away but also laid the foundation then for economic growth in the future.
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Well, remember I told you that it’s going to take some time for this economy to come back. One of the reasons it’s going to take time for this economy to come back is the housing market is still a big drag on the economy as a whole. And the reason the housing market is still a big drag on the economy as a whole is we built a lot of homes over the previous five, seven, 10 years. Every year, about 1.4 million families are formed that are ready to buy a new house, or need some place to live.
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And all that inventory that happened during the housing bubble, it’s still out there. So some states are worse than others. You go to places like Nevada or Arizona or Florida, California, their inventory of unsold homes was so high that it is just going to take a whole bunch of years to absorb all that housing stock.
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Now, what we can do is to help people who are currently in their homes stay in their homes. We can strengthen the economy overall so that that new family that just formed, they feel confident enough to say, you know what, it’s time, honey, for us to go out and take the plunge and start looking. And right now they’re kind of holding back, the way a lot of people are still holding back, because there’s uncertainty in the market. And we’ve initiated, through the Treasury Department, a number of programs like that to help support the housing market generally.
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And that’s part of what health care reform was all about. I’ll just give you a couple examples. One of the things that we were doing in Medicare was we were giving tens of billions of dollars of subsidies to insurance companies under the Medicare Advantage plan, even though that plan wasn’t shown to make seniors any healthier than regular old Medicare.
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So we said, all right, we’re not going to end Medicare Advantage, but we are going to have some competitive bidding and we’re going to force the insurance companies to show us, well, what exactly -- what value are you adding? How are you helping to make these seniors healthier? And if you’re not helping, then you shouldn’t be getting paid. We should be giving that money to the doctor and the nurse and the other people who are actually providing care, not the insurance companies.
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Well, no, it’s actually all of our problem, because part of the reason we had this financial crisis was because people did not always understand the financial instruments that they were purchasing. A lot of these subprime loans that were being given out, a lot of these no-interest -- you can buy your house, you don’t put any money down, you don’t pay any interest, you got this beautiful house -- and naturally people were thinking, well, this sounds great. But what they weren’t looking at was, okay, there’s a balloon payment five years down. This is only going to work if your housing -- the value of your house keeps on appreciating. And if it stops appreciating, suddenly it’s not going to work anymore. People hadn’t thought through all those ramifications. And that had an effect on the whole system.
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Well, as an example of the kinds of things that this new agency are going to be enforcing, we’ve already passed a law -- thanks again to Mary Jo and Sherrod -- we’ve already passed a law that says a credit card company can’t raise the interest rates on existing balances. So it can’t attract you with a zero percent interest, you run up a $3,000 balance, and then suddenly they send you your next statement and it says, oh, your interest went up to 29 percent. You can’t do that. I mean, they’ll still be able to say, we’re going to raise your interest rate to 29 percent, but that can only be the balances going forward. It can’t be on the money that you borrowed where you thought it was a zero percent.
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Well, that's an example of straightforward, honest dealing that we’re going to be expecting. We think the financial markets will still make money, the banks can still make money, but they got to make money the old-fashioned way, which is loan money to small businesses who are providing services to the community. Loan money to Joe for his architectural firm, and he’s going to make sure you pay him back. Loan people for mortgages, but make sure that you’ve done the due diligence so that you’re not tricking them into something they can’t afford. Make sure that it’s something that you can afford -- right?
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We did not become the most prosperous country in the world by rewarding greed and recklessness of the sort that helped cause this financial crisis. We did not come this far by letting special interests run wild in Washington, writing their own rules. We did not get here by just looking after ourselves and not looking after our neighbors. We got here by rewarding the values of hard work and responsibility, and by investing in our people, and making sure that economic growth happened from the bottom up -- middle-class families and small business owners. We did it by out-working and out-educating and out-competing every nation on Earth. That's who we are. That's who we need to be.
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Now, let me tell you, Florida, the United States of America, we do not play for second place. We play for first place. We’ve got to rebuild this economy stronger than it was before. And at the center of that agenda are three powerful words: “Made In America.” We've got to start making things here in the United States. Instead of giving tax breaks to companies that ship our jobs overseas, we’ve got to cut taxes for companies that create jobs right here in the United States of America. We’ve got to give tax cuts to small business owners, and tax cuts to clean energy companies, and tax cuts to middle-class families -– which is what we did. Ninety-five percent of American workers got a tax cut under my administration. That was the right thing to do.
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We’ve got to invest in 21st century infrastructure. That means new bridges and new roads, but it also means faster Internet, high-speed railroad –- projects that will lay the foundation for long-term economic growth but also produce hundreds of thousands of new, private sector jobs. And we are helping old industries, like the American auto industry, get back on its feet and retool for the 21st century.
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Now, you will remember a while back, this was an industry -- the auto industry -- that had lost hundreds of thousands of jobs in the year before I took office. And we had to make a tough decision about whether to help them out or walk away, which might have cost another million jobs. And a lot of folks said we should walk away. We decided, no, we're going to take a different approach. Instead of continuing to give bailouts to the auto companies and asking nothing in return, we said we are going to make sure you restructure so you can compete over the long haul.
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To ensure that a financial crisis like the one doesn’t happen again, we passed financial reform that provides new accountability and tough oversight of Wall Street. It’s going to stop credit card companies from charging hidden fees or unfair rate hikes. It’s going to end the era of Wall Street bailouts once and for all.
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And these reforms, all these reforms taken together, are going to make America more competitive in the 21st century. They move us forward. And on each of these reforms, we reached out to Democrats and Republicans for ideas and for support. But I have to tell you in just about every instance, almost every Republican in Congress said no. No on help for small businesses. No on middle-class tax cuts. No on clean energy jobs. No on making college more affordable. No on Wall Street reform.
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And let me be clear about how we're going to move our economy forward. The key to moving this economy forward is going to be the private sector. Government is not going to be the primary driver of job creation in this country. We want businesses to succeed. The free market is the greatest instrument of wealth production in our history. But -- so if you’re a responsible business owner, I want to do everything I can to help you grow and prosper and hire more employees. But I don’t think it’s anti-business to say we should make sure an oil rig is safe before you start drilling. I don’t think it’s anti-business to say Wall Street banks should play by the same rules as everybody else. I don’t think it’s anti-business to say that insurance companies should deny people care just because they get sick -- to make sure that we say to insurance companies, you got to treat people fairly -- that's not being anti-business. That's just being -- common sense.
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And if you’ll join Alex Sink, and if you’ll join Kendrick Meek, and you join me to build a future where all our kids are getting educated, and small businesses are flourishing because of their ideas and their ingenuity, and we're creating clean energy jobs all across America -- if you’ll join me in building a future that thinks about more than just politics, thinks about how are we going to meet this solemn obligation we have to those who ae coming after us -- I'm absolutely positive that the 21st century is going to be the American Century, just like the 20th.
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You see, we did not become the most prosperous country on Earth by rewarding greed and recklessness of the sort that helped cause this financial crisis. We didn’t come this far by letting a handful of irresponsible folks on Wall Street or insurance companies or special interests run wild. We did it by rewarding the values of hard work and responsibility, by investing in people who’ve built this country from the ground up -– middle-class families and small business owners. We did it by out-working and out-educating and out-competing every nation on Earth. That’s what we are going to do again.
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And we’re helping to get the American auto industry back on its feet and retool for the 21st century. Now, this is an industry that had lost hundreds of thousands of jobs in the year before I took office. We had to make a tough decision about whether to help them out or walk away from what could have potentially been another million jobs. And I decided we couldn’t walk away.
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All these reforms will make America more competitive in the 21st century. All these reforms are helping to move us forward. And on each of these reforms, we reached out to Democrats and Republicans for ideas and support. But in just about every instance, almost every Republican in Congress said no. They said no to help for small businesses. They’re still saying no. They said no on middle-class tax cuts. This is supposed to be the party of tax cuts -- said no when it came to tax cuts for folks who needed them. No on clean energy jobs right here in Ohio and across the country. No on making college more affordable. No on Wall Street reform.
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The top Republican on the Energy Committee, you may recall -- this is the guy who would be in charge of the Energy Committee in the House of Representatives -- apologized after the oil spill to BP. Remember this? He apologized because I had said to BP you need to set aside $20 billion to make sure that we’re making fishermen and small business owners whole as a consequence of your mistakes. This guy, he apologized to BP. He said, oh, the President shook you down -- a Chicago-style shakedown. That's what he called it. That's what he called it. He had to throw in the Chicago thing in there.
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And by the way -- let me make this point -- I want business in this country to succeed. The free market -- the free market is the greatest wealth producer in our history. We were built on entrepreneurship and private enterprise. And if you are a responsible business owner, I will do everything I can to help you grow and prosper and hire more employees. And Ted Strickland will do the same. But I don't think it’s anti-business to say we should make sure an oil rig is safe before we start drilling. I don’t think it’s anti-business to say that Wall Street banks should play by the same rules as everybody else. I don’t think it’s anti-business to say that insurance companies shouldn’t deny people care just because they get sick.
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Five years ago, many questioned whether people could ever return to this city. Today, New Orleans is one of the fastest growing cities in America, with a big new surge in small businesses. Five years ago, the Saints had to play every game on the road because of the damage to the Superdome. Two weeks ago, we welcomed the Saints to the White House as Super Bowl champions. There was also food associated with that. We marked the occasion with a 30-foot po’boy made with shrimps and oysters from the Gulf. And you’ll be pleased to know there were no leftovers.
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But we have to do more. And there’s currently a jobs bill before Congress that would do two big things for small business owners: cut more taxes and make available more loans. It would help them get the credit they need, and eliminate capital gains taxes on key investments so they have more incentive to invest right now. And it would accelerate $55 billion of tax relief to encourage American businesses, small and large, to expand their investments over the next 14 months.
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The small business owners and the communities that rely on them, they don’t have time for political games. They shouldn’t have to wait any longer. In fact, just this morning, a story showed that small businesses have put hiring and expanding on hold while waiting for the Senate to act on this bill. Simply put, holding this bill hostage is directly detrimental to our economic growth.
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Now, no single step is the silver bullet that will reverse the damage done by the bubble-and-bust cycles that caused our economy into this slide. It’s going to take a full-scale effort, a full-scale attack that not only helps in the short term, but builds a firmer foundation that makes our nation stronger for the long haul. But this step will benefit small business owners and our economy right away. That’s why it’s got to get done.
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There’s no doubt we still face serious challenges. But if we rise above the politics of the moment to summon an equal seriousness of purpose, I’m absolutely confident that we will meet them. I’ve got confidence in the American economy. And most importantly, I’ve got confidence in the American people. We’ve just got to start working together to get this done.
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Our most urgent task is to restore our economy, and put the millions of Americans who have lost their jobs back to work. To strengthen our middle class, we must give all our children the education they deserve, and all our workers the skills that they need to compete in a global economy. We must jumpstart industries that create jobs, and end our dependence on foreign oil. We must unleash the innovation that allows new products to roll off our assembly lines, and nurture the ideas that spring from our entrepreneurs. This will be difficult. But in the days to come, it must be our central mission as a people, and my central responsibility as President.
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Part of that responsibility is making sure that we honor our commitments to those who have served our country with such valor. As long as I am President, we will maintain the finest fighting force that the world has ever known, and we will do whatever it takes to serve our veterans as well as they have served us. This is a sacred trust. That’s why we’ve already made one of the largest increases in funding for veterans in decades. We’re treating the signature wounds of today’s wars -- post-traumatic stress disorder and traumatic brain injury -- while providing the health care and benefits that all of our veterans have earned. And we’re funding a Post-9/11 GI Bill that helps our veterans and their families pursue the dream of a college education. Just as the GI Bill helped those who fought World War II -- including my grandfather -- become the backbone of our middle class, so today’s servicemen and women must have the chance to apply their gifts to expand the American economy. Because part of ending a war responsibly is standing by those who have fought it.
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Incomes for working families fell by almost 5 percent. All the while, middle-class families saw everything from tuition bills to health care bills skyrocket. And for too many hardworking families, the American Dream was slowly slipping away.
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So my most urgent task as President was to prevent a second Depression. Now, 19 months later -- 19 months later, we’ve done that. The economy is growing again. The financial markets have stabilized. The private sector has created jobs for the last eight months in a row. There are 3 million Americans who wouldn’t be working today if not for the economic plan we put in place. That is a fact.
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Over the last 19 months, we’ve closed several of these tax loopholes. Over the next two years, we’ll fight to give tax breaks to companies that actually create jobs within our borders -- to small businesses, to clean energy companies, to American manufacturers, to entrepreneurs that are researching and investing and innovating right here in the United States of America. That's who we want to help. That's the choice in this election.
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If we hand the other side the keys, they’ve promised to spend the next two years chipping away at the new rules we’ve put in place for special interests. And I refuse to let them do that. I refuse to go back to the days when insurance companies could deny you coverage or drop your coverage just because you’re sick.
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Two small businesses who were there saying, we provide health insurance to our workers, but one guy, he said his premiums had gone up 100 percent in seven years. He said, basically I could no longer afford it. Either I was going to have to lay off workers or stop giving them insurance -- until this bill passed. And now that small business owner is able to keep providing health insurance to his workers. That's what we’re fighting for.
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But they pose as non-for-profit, social welfare and trade groups. Every single one of them, virtually, is guided by seasoned, Republican political operatives. None of them will disclose who is paying for these ads. They are spending tens of millions of dollars against Democratic candidates without telling the American people where that flood of money is coming from. You don't know if it’s coming from big oil or insurance companies. You don't even know if it’s coming from a foreign-controlled corporation.
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Dr. King made famous a saying that “the arc of the moral universe is long, but it bends towards justice.” We are moving in the direction of justice. We are moving in the direction of prosperity. But we’ve got to keep on moving. We can’t stop now. And if we are out there working hard, if we are out there rekindling that spirit of hope, we won’t just win this election, we will restore our economy, rebuild the middle class, reclaim the American Dream for the next generation.
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Obviously we continue to have more work to do. On the economic front, although the world economy is now growing again, I think it’s going to be very important for us to have frank discussions and continue to do more work cooperatively in order to achieve the type of balance and sustained economic growth that is so important and that we both signed up for in the context of the G20 framework.
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Just now you, , referred to a host of areas where our two countries have cooperated, and I have come to the United States with such a cooperative spirit, too. Our two countries can have cooperation on a series of major international issues and regional hotspot issues. We have cooperation on tackling the financial crisis and meeting the climate challenge. China and the United States have also embraced an even closer and bigger relationship in the fields of pubic finance, financial industry and economic cooperation and trade.
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There is much to show for our efforts, even as there is much work to be done. The global economy has been pulled back from the brink of a depression, and is growing once more. We have resisted protectionism, and are exploring ways to expand trade and commerce among nations. But we cannot -- and will not -- rest until these seeds of progress grow into a broader prosperity, not only for all Americans, but for peoples around the globe.
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In times of economic unease, there can also be an anxiety about human rights. Today, as in past times of economic downturn, some put human rights aside for the promise of short term stability or the false notion that economic growth can come at the expense of freedom. We see leaders abolishing term limits. We see crackdowns on civil society. We see corruption smothering entrepreneurship and good governance. We see democratic reforms deferred indefinitely.
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It’s a future where, because their country has been welcomed back into the community of nations, more Sudanese have the opportunity to travel, more opportunity to provide education, more opportunities for trade. It’s a future where, because their economy is tied to the global economy, a woman can start a small business, a manufacturer can export his goods, a growing economy raises living standards, from large cities to the most remote village.
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The key is for us to keep on improving the economy, and that’s going to be my number one priority over the next several years. If the economy is growing, if we’re investing in small businesses so they can open their doors and hire more workers, if we’re helping large businesses in terms of plants and equipment -- a lot of the initiatives that I’ve put in place already -- if we’re building infrastructure -- not just roads and bridges but also broadband lines -- if we’re investing in clean energy -- all those things are going to open up new opportunities for young people with skills and talent for the future.
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And so all those things can be helpful in moving us forward. But the single most important thing I’ve got to do is make sure that we get this economy back on track, and that's why I’m so focused on things like a bill I’m going to be signing today that provides small businesses further incentive to invest and gives them tax breaks and financing, because they’re huge drivers of job creation over the long term.
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Because keep in mind, even before this financial crisis, we were slipping in a lot of ways. From 2001 to 2009, during that eight-year period, wages -- average wages for middle-class families actually fell by 5 percent. Think about that. People’s real incomes were actually falling -- and this was at a time before the crisis. So supposedly, the economy was growing and things were going pretty well. In fact, people’s incomes were falling.
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The first question has to do with the changing demographics here in our neighborhood as well as in the public school system. I grew up here in this neighborhood, I’m raising my own family here, I work at a local public school here. And I’ve seen over the years firsthand how recent immigrants have revitalized our local economy. They start small businesses, they hire locally, they live within the community. How do you envision a comprehension immigration reform as one measure towards America’s economic recovery and long-term vitality?
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Well, the housing crisis helped to trigger the financial crisis. And it’s a complicated story, but essentially what happened was, banks started seeing money in peddling what looked like these very low-interest-rate mortgages, no money down. Started peddling these things to folks. A lot of people didn’t read the fine print, where they had adjustable-rate mortgages or balloon payments, and they ended up being in situations where they were in homes that they couldn’t necessarily afford.
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The banks made a whole bunch of money on all these mortgages that were being generated. But what happened was -- is that when the housing market started going down, then all these financial instruments that were built on a steady stream of payments for mortgages, they all went bust, and that helped to trigger the entire crisis.
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So the housing issue has been at the heart of the economic crisis that we’re in right now. It is a big problem because part of what happened over the last several years is, is that we built more homes than we had families to absorb them. And what’s happened now is, is that housing values have declined around the country, in some places worse than others. In Nevada, in Arizona, they’ve been very badly hit. In New Mexico, I don’t think we had the same bubble, and so prices have not been as badly affected here. But overall across the country, housing lost a lot of value.
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But it’s going to take some time. We’re working our way out of overbuilding in the housing market, a lot of not very sensible financial arrangements in the housing market. And we’ve got to get back to sort of a traditional, more commonsense way of thinking about housing which is, if you want a house you got to save for a while. You got to wait until you have 20 percent down. You should go for a mortgage that you know you can afford. You’ve got to -- there shouldn’t be any surprises out there, right? That kind of traditional thinking about saving and thinking about the house not as something that is always going up 20 percent every year and you’re going to flip and take out home equity loans and all that -- we’ve got to have a different attitude, which reflects what you talked about, more of an attitude that this is your home. This is not just a way to make quick money.
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So it’s an environmental win and it’s a pocketbook win. And it creates businesses, because you can have a whole bunch of mom-and-pop HVAC companies who suddenly they’re out there getting business retrofitting homes to make them energy efficient. And small businesses can grow into larger businesses, can grow into bigger businesses.
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-- but let me describe for you what we did. Number one is we set up loan facilities both through the SBA as well as the new facility so that if you want to expand your business, you’re having trouble getting credit through your local community bank, we are now providing additional financing to the bank that they -- that gives them an incentive to loan to you and they only get these loans if they pass it on to small businesses.
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SBA, the Small Business Administration, also has a whole host of lending programs that we have expanded. We’ve reduced the fees for them. We’ve made it easier to apply. So if you’re interested in the lending programs, then you should contact your local SBA administrator here in New Mexico, and I’m assuming that they’re -- I’ll bet your congressman here could probably let you know immediately how to get in touch with them and they would outline for you all the programs that were available. So that’s on the lending side.
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Now, what we’ve also done is on the tax side we have said that for companies that are starting up, small businesses that are starting up, we’re going to give them a whole bunch of tax breaks. If you decide that you have to build a new oven, and you haven’t been sure -- should you invest in it this year, should you put it off, it’s kind of expensive -- well, we’re giving you incentives to go ahead and buy that oven this year and put it in. And it will be cheaper for you because you can essentially take -- you can write off the business expenses of purchasing that oven this year a lot faster than you would have otherwise been able to do. So that’s an example of just one of the kinds of tax cuts that are provided in this bill.
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So we’ve got a whole basket of tax cuts and lending assistance to small businesses. And the reason this is so important is because small businesses create the majority of new jobs in this country. Big businesses are very important, too, and we’re trying to encourage them obviously to do more to invest. They actually have a lot of money right now. It’s just they’re sitting on the sidelines with it instead of investing it, and we’ve got to encourage them to invest more.
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But small businesses, that’s the beating heart of so many communities -- restaurants like yours, small dry cleaners, a plumbing operation, a tent company a flower shop. Okay, so the -- we’ve got a bunch of small business owners here. You knit the community together, and you give people opportunity, as well as building something for your family. And you’re so invested in it because it’s yours.
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I’ve got to do a little bit of editorializing again, though, about the politics of this because this is something that -- this bill that I signed this week drew on Republican and Democratic ideas. Traditionally, this is something that’s been completely bipartisan. The Chamber of Commerce, the Association for Small Businesses, a whole bunch of different groups supported it. We could not get the Republicans to let this come up to a vote for months. And there were finally articles in USA Today about how small businesses were holding off making investments or hiring because they were still waiting to see if this thing would pass.
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These are just basic things that we can do. If they decide they want to open a business, we can make sure that they can get some financing and that they don’t have to pay capital gains on their startup business. These little things add up to big things. It means that they can focus their energy on their dreams and their vision and what they’re trying to build, and not spend all their time constantly just worrying about, am I going to be able to go to school or not. That should be a given in this country because it’s good for all of us, not just for these young people individually.
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And, I mean, that’s kind of the issue that I have is, we put in our taxpayer dollars and, you know, it’s -- I mean, I have a small business myself. We help provide people with legal services, stuff like that, you know, having access to their rights. But when you can’t afford it, I mean, we’re forced to just basically settle for what we got because of the fact that that’s all we could afford.
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And there are a whole host of individual issues -- education and energy and what we do in terms of our foreign policy -- a whole bunch of discrete issues that concern me. What concerned me most I think was the nature of our economy and how the American Dream seemed as if it was slipping away for too many people.
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So what I said was I’m going to run for President because there are some long-term things that we can do that will start growing our economy from the bottom up, make sure that the middle class is expanding, make sure that innovation and entrepreneurship is taking place in this country and not someplace else, that we can start rebuilding our economy so that it works for everybody. And that was really the platform that I ran on in 2008.
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So we had already lost most of the 8 million jobs that we were going to end up losing in this recession before any of my economic policies even had a chance to take effect. And the financial system was on the verge of meltdown, so that people couldn’t even get loans to buy a car. I mean, credit was just shut down.
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So we had to take a number of emergency measures. We stepped in and we stopped the bleeding. Now the economy is growing again. We’ve had private sector job growth for the last eight months. Credit is now flowing again, although small businesses are still having a tough time getting credit and so we’ve been focused -- we signed a bill actually this week to help small businesses get credit and cut some of their taxes.
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And that’s why financial reform was so important, so we never have to engage in taxpayer-funded bailouts again. That’s why health reform was so important because we had the opportunity not only to help ordinary folks have a better handle on their health care costs, but also that over time, we could make the health care system as a whole more efficient and effective.
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So insurance companies can no longer drop your coverage when you get sick, which was happening. Sometimes there were some insurance companies who were going through your policy when you got sick to see if you had filled out the form wrong, you hadn’t listed some infection that they might call a preexisting condition, et cetera -- a bunch of fine print that led to people not having health insurance. So that was one thing that we said.
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The other thing that we did was we said if you’re a lot of people who don’t have health insurance, it’s because they work for small businesses, who have trouble affording health insurance, because they’re not part of a big pool -- they’re not like a big company that has thousands of employees and they can negotiate because the insurance companies really want their business -- so what we said was let’s provide tax breaks to small businesses so they can -- they’re more likely to buy health insurance for their employees. And right now about 4 million businesses across the country are now getting a tax break, a tax credit, if they provide health insurance for their employees, that can save them tens of thousands of dollars. So that’s the second thing.
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I always hear -- I’m never confrontational, I’m sure everybody here will tell you that -- but I always hear that we’re trying not to tax anybody but the people that make over that $250,000, that elitist 2 percent. Any viable, strong competitive business -- and the name of our business is “Competitive Edge,” 30 years ago, before CNN ever used it as a term -- the hope is that you’re supposed to grow profitability so you can grow your business.
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So these are the choices -- so it’s not that when it comes to small businesses, or big businesses, that I have any interest in raising taxes. I’d like to keep taxes low so that you can create more jobs. But I also have to make sure that we are paying our bills and that we’re not adding -- putting off debt for the future generation.
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So I think that to say to the top 2 percent of businesses -- which, by the way, includes hedge fund managers who have set up an S corporation but are pulling down a billion dollars a year but they’re still considered a small business under the criteria that are set up there, that to say to them, you’ve got to pay a modestly higher amount to help make sure that our budget over time gets balanced -- I think that’s a fair thing to do.
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And I think -- when I talk to a lot of businesses, they just don’t want super high rates of the sort that existed before Ronald Reagan came into office. And I’m very sympathetic to that. And on capital gains and dividends, for example, we want to keep those relatively level. We don’t want -- I would like to see a lower corporate tax rate. But the way to do that is to eliminate all the loopholes, because right now on paper we’ve got a high corporate tax rate. But in terms of what people actually pay, they’ve got so many loopholes that they’ve larded up in the tax code, that effectively they pay very low rates.
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I will say the reason that I’m pushing China about their currency is because their currency is undervalued. And that effectively means that goods that they sell here cost about 10 percent less and goods that we try to sell there cost about 10 percent -- let me not say 10 percent, because I don’t want the financial markets to think I’ve got a particular -- there is a range of estimates. But I think people generally think that they are managing their currency in ways that make our goods more expensive to sell and their goods cheaper to sell here. And that contributes -- that’s not the main reason for our trade imbalance, but it’s a contributing factor to our trade imbalance.
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Q I’m a proud Iowa social worker who works with crime victims. And my question is about the poverty rate. We currently have a rate of 14 percent poverty. That’s one out of seven people are in poverty. And I believe that that’s the highest rate since the 1960s. And there’s a lot of reasons why people go into poverty who weren’t in poverty before, things like medical emergencies and losing jobs, being a crime victim and, especially for women, a divorce.
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The single most important thing I can do to drive the poverty rate down is to grow the economy. What has really increased poverty is folks losing their jobs and being much more vulnerable. So everything we can do to provide tax breaks for small businesses that are starting up, to make sure that we are encouraging -- for example, trying to accelerate investment in plants and equipment this year, and letting people write it off more quickly so that companies that are on the sidelines that are thinking about investing, they say, you know what, why don’t we go ahead and take the plunge now and start hiring now, instead of later -- all that can make a big difference in terms of growing the economy, reducing the unemployment rate. That’ll reduce the poverty rate.
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The second most powerful thing I can do to reduce the poverty rate is improve our education system because the single biggest indicator of poverty is whether or not you graduated from high school and you’re able to get some sort of post-secondary education. And right now too many of our schools are failing.
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My question for you comes from a member of my congregation who is 55 years of age, has a wife, two children who are freshmen in high school. A year ago he lost his job in manufacturing. He’s been unemployed now for a year plus. What will your economic policies do for him within the next year, and hopefully to be able to secure a job and have that American Dream again, which has now been lost?
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And we were in Michigan, looking at one of these plants. A lot of the folks who were there are folks who used to work as suppliers for the auto industry. They had gotten laid off, and now they’re back helping to build what will be the cars of the future. These advanced batteries that they’re building are going into the Chevy Volt, which is a American-built clean energy car, a car of the future.
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There’s only one candidate who stood up to insurance companies so that every Californian can have accessible and affordable health care, making sure that insurance companies aren’t dropping you when you get sick, making sure young people can stay on their parents’ health insurance until they’re 26 years old.
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Now, look, let’s not fool ourselves. This is a tough election. This is a difficult election because this country has gone through one of the most difficult periods in our nation’s history. And it didn’t just start with the financial crisis. Over the last decade, between 2001 and 2009, middle-class families had seen their incomes actually decline by 5 percent. Think about that. During that eight-year period, middle-class families had less money at the time -- at the same time that their health care costs were shooting up, sending your kids to college was becoming more and more expensive. Job growth between 2001 and 2009 was the most sluggish since World War II, more sluggish than it’s been over the last year.
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Look, Barbara and I, we’ve got a different idea, a different vision about what our future should look like -- and it’s an idea rooted in our own experience, living out the American Dream, because we didn’t come from plenty. We know government doesn’t have all the answers to our problems. We want a government that is lean and efficient.
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So if we give them the keys back, they’ll keep giving tax breaks to companies that ship jobs overseas. I want to give tax breaks. Barbara wants to give tax breaks. We already have -- to companies that are investing right here in the United States of America, to small businesses and American manufacturers and clean energy companies that are building solar panels and wind turbines and electric cars right here in the United States of America with American workers. That’s the choice in this election. That’s what we’re about.
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They don’t have the guts to say, we’re funding this. So they hide behind these front groups. You don’t know who these groups are. You don’t know who’s funding it -- although we have a pretty good idea. Smearing Democratic candidates. This is thanks to a gigantic loophole. They can spend without limit, keep their contributions secret. It could be oil companies, Wall Street speculators, insurance companies. You don’t know. They won’t tell you. They won’t say.
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What was true then is just as true now. And so if everybody here keeps that spirit alive, and is out there knocking on doors, and making phone calls, and calling their friends, and calling their neighbors, and reminding everybody of the same hope, the same possibility that we did two years ago, we’re not just going to reelect Barbara Boxer, we are going to make sure that the American Dream is alive and well for future generations.
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I know there are a whole bunch of Republicans out there who felt the same way. But the Republican leaders in Washington, they made a different decision. Here’s the thing, they realized what a big mess they had made. They said, boy, we screwed up so bad, it is going to take a really long time to recover those 8 million jobs that were lost. It’s going to take a long time before the housing market fully recovers. So our best bet, instead of trying to help Obama and Harry Reid to solve problems, we’re going to stand on the sidelines, sit on our hands, and basically just say no to everything.
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We refuse to let that happen, because I don’t want your health care denied just when you need it most because insurance companies are playing games. I don’t want you to have to pay for another Wall Street bailout. I don’t want credit card companies to be able to jack up your interest rates whenever they feel like it without giving you notice.
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You don’t even know who’s sponsoring these ads. They have all these names like “Americans for Prosperity,” “Mothers for Motherhood.” Actually, I made that last one up, but -- but they’re spending without limit, keeping their contributions secret. They don’t even have the guts to stand up for what they say they believe in. And we don’t know who’s funding them. Is it the oil industry? Is it the insurance companies? Is it speculators? They won’t tell you. They won’t say. They don’t want you to know who’s bankrolling all these negative ads.
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And if all of you are going to go out and vote, all of you knock on doors, all of you are talking to your friends and neighbors, I promise you we will not just win this election, we just won’t elect Harry Reid, but we are going to restore the American Dream, the Vegas dream, the Nevada dream, for families for generations to come.
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This election is a choice. And if we give them the keys -- which will happen if you don’t vote -- they’ll keep giving tax breaks to companies that ship our jobs overseas. We want to give tax breaks to companies that create jobs right here in the United States -- to small businesses and American manufacturers and clean energy companies. Because I don’t want wind panels and -- wind turbines and solar panels and electric cars made in Europe or Asia. I want them built right here in the United States -- by American workers here in the United States of America. That's the choice in this election.
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I understand that. But don’t let anybody tell you that our fight hasn’t been worth it. Don’t let them tell you that we’re not making a difference. Because of you, there are people right here in California who don’t have to choose between getting treatment for their cancer or going bankrupt. Because of you, there are parents who are able to look their children in the eye and say, yes, you will go to college. We can afford it, we’re getting some help. Because of you, there are small businesses who are able to keep their doors open, even in the midst of recession. Because of you, we have brought home nearly 100,000 brave men and women from Iraq.
Because of you, we are going to continue to fight to end “don’t ask, don’t tell.” Because of you, we are going to make sure that we’ve got an energy policy for the future of America.
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The only candidate who’s helped grow this state’s economy. The only candidate who’s put people back to work. The only candidate who’s saved taxpayer dollars by cutting waste and abuse. So you know Mark Dayton. He’s got a track record. He’s the only candidate in this race who will stand up for the middle class, who’s got a plan to balance the budget without sacrificing our children’s education. A candidate who has a plan to create jobs and help small business owners grow and to thrive.
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If you give the other side the keys, the other side will keep giving tax breaks to companies that ship jobs overseas. Mark and I, we want to give tax breaks to companies that are investing right here in Minnesota, right here in the United States -- in small businesses and American manufacturers. We want to invest in clean energy companies -– because I don’t want solar panels and wind turbines and electric cars built in Europe or built in Asia. I want them built right here in America, with American workers. That’s the choice in this election.
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Why would we do that? Why would we do that? Why would we go back to the point where credit card companies could jack up y our interest rates without any notice, and could institute hidden fees? Why would we go back to the health care policies that they believe in, where insurance companies could drop your insurance when you get sick? Why would we do -- why would we put those folks back in the driver’s seat?
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Let me tell you about health care reform. Because of health care reform, everybody here who is under 26 can stay on their parents’ health care even if they don't have health insurance. Because of that reform, insurance companies can't drop somebody because they’ve got a preexisting condition. Because of health care reform, millions of small businesses are getting tax credits so they can afford to provide health insurance to their employees.
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Let me tell you something. We believe in making sure people don't get ripped off when they sign up for a mortgage. We believe in making sure that credit card companies treat you fairly. We believe taxpayers shouldn’t ever be forced to pay for Wall Street’s mistakes. We believe that insurance companies should cover you when you’ve been paying your premiums. That's what we believe. That's the choice in this election. That's why you’ve got to elect Mark Dayton governor, because he believes it, too.
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But I want everybody here to understand -- don’t let anybody tell you that what you did has not made a difference, that the fight isn’t worth it. Because of you -- because of you, there’s somebody in Minnesota right now that, instead of going bankrupt, is able to get treatment for their cancer. Because of you, there’s a young person who’s going to be able to go to college. Because of you, some small business has stayed open in the depths of a recession. Because of you, there are 100,000 brave young men and women who we've brought home from Iraq. Because of you. Because of you.
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So I need you to keep fighting. I need you to keep working. And I need you to keep believing. And if you knock on some doors again, if you make some phone calls again, if you talk to your neighbors again, if you go to vote again, then I promise you we won’t just win this election, we won't just have Mark as governor, but you and I together, we are going to restore the American Dream for future generations.
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So we had a big job when we first came in. And our first job was obviously to stop the bleeding -- and we did that. An economy that was shrinking is now growing again. An economy that was shedding hundreds of thousands of jobs every month, we've now seen nine months of consecutive job growth in the public sector -- in the private sector.
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The same is true on Wall Street reform. We said that we've got to have a financial system that is vibrant and dynamic, but also a financial system that has basic rules of the road, that works for everybody, not just for some. So we made sure that credit card companies can't jack up your interest rates arbitrarily, without notice. We made certain that mortgage brokers can't steer you to more expensive interest rate mortgages. We made sure that we got systems in place to guard against the kind of structural breakdowns that resulted in the taxpayer bailouts that all of us find unacceptable.
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We've got a race to see who’s going to determine the clean energy future. And one of the things we did in the Recovery Act was invest in solar panels and wind turbines and advanced battery manufacturing here in the United States of America. I want those things made here. But right now we're getting our clock cleaned because we have not been serious about making those investments. And we haven't set the guideposts where private capital could come in and start making those investments. And that means losing that race. That's not acceptable.
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Because of the work that these members of Congress did, because of the support that you’ve provided them, there are people right here in Minnesota who are able to get coverage for their cancer treatments instead of having to sell their house. Right now, today. Because of what you did, there are small businesses that are open right now that otherwise would have shuttered their doors.
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Like most small businesses, American Cord and Webbing has gone through some tough times in the past few years. Early in 2009, they lost customers and had to lay off some workers. But they buckled down -- that was a pun. You got that? You catch that one? And then invested in new products and pursued new customers. And over the past year, they’ve hired back all the workers they had to lay off. And today business is going well.
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Now, this is important -- not just for this particular business and these particular workers, but for America. It’s small businesses like this one, after all, that are the bricks and blocks, the cord and webbing, if you will, of our economy. But the financial crisis made it very difficult for them to get the loans that they needed to grow.
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And that’s why, over the past 20 months, we’ve done everything we can to boost small businesses like this one. And what’s guided us is a simple principle: Government can’t guarantee your success, can’t guarantee Mark’s success -- he doesn’t expect it to -- but government can knock down some of the barriers that stand in the way of small business success and help create the conditions where small businesses can grow and hire and create new products and prosper.
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We’ve passed tax cuts for hiring back unemployed workers. We’ve passed tax cuts for investing in new equipment. There are 4 million small businesses right now that are poised to get a tax break of up to 35 percent of the premiums they pay if they are providing health insurance to their employees -- and that’s a tax break that can free up tens of thousands of dollars to upgrade facilities, buy new equipment, or hire a few new workers.
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The law also accelerates $55 billion in new tax cuts for businesses both large and small that make job-creating investments over the next year. It eliminates capital gains taxes on key new investments made in small businesses until the end of this year. It dramatically increases the amount small businesses can write off on new equipment investments -- and we want to do more, so that you can write it all off. These are tax cuts that can help America -- help businesses like American Cord and Webbing that are making new investments right now. And it can help create jobs.
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Finally, the law that we signed creates new initiatives to increase lending to small businesses. It strengthens state programs that spur private sector lending, and that’s a step that will support $15 billion in new small business loans across the country. And it sets up a new Small Business Lending Fund that will support Main Street banks that lend to Main Street businesses.
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When new loans are hard to come by, I believe we should help free up lending. When some companies are shipping jobs overseas, we should be helping companies like this one -- our small businesses, our manufacturers, our clean energy companies. I think those are pretty commonsense values that we can all agree on.
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When you vote against small business tax relief and you hold up a small business jobs bill for months, that doesn’t do anything to support small businesses like this one. It doesn’t do anything to support the outstanding workers at this company. It’s just playing politics. If you’re going to talk a big game, then you need to deliver.
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So I hope that my friends on the other side of the aisle are going to change their minds going forward, because putting the American people back to work, boosting our small businesses, rebuilding the economic security of the middle class, these are big national challenges. And we’ve all got a stake in solving them. And it’s not going to be enough just to play politics. You can’t just focus on the next election. You’ve got to focus on the next generation.
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And because of the steps we’ve taken, we no longer face the possibility of a second depression. The economy is growing again. We’ve seen private sector job growth for nine months in a row. I just had a chance to visit with some of the elected officials at a wonderful small business here that is representative of small businesses all across the country. They survived the recession, and they're now ready to grow and expand.
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If we give the other side the keys to the car, you know what they're going to do? They're going to keep on giving tax breaks to companies that ship jobs overseas. I believe in tax breaks for companies like the one that I just visited, companies that are investing here in the United States, small businesses, American manufacturers, clean energy companies.
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That’s why, with the help of a Democratic Congress, we took tens of billions of dollars that were being put into unwarranted subsidies for banks in the student loan program. We said, let’s not do that. Let’s have the money go where it belongs -- to the students. And we now have millions more young people who are able to get student loans and Pell Grants -- higher levels of grants, a $10,000 tuition relief credit for each student. That’s our agenda for economic growth. That’s what’s going to make a difference.
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Look -- and let me just say, they’ve already said, the other side has already said, we’re going to roll back regulations and put special interests back in charge in Washington. This is not me making it up. The person who would take over the energy committee in the House of Representatives is the guy who apologized to BP when we said, you’ve got to pay for all the small businesses and families that have been -- and fishermen that have been hurt by the oil spill.
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Look, we believe in making sure that people don’t get ripped off when they sign up for a mortgage. We believe credit card companies shouldn’t be able to jack up your rates without notice. We believe that insurance companies, if you’re paying your premiums, they actually have to pay when you get sick. They can’t drop your health insurance when you get sick.
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But understand, the other side is fighting back. The same special interests we’ve been battling on your behalf over the last two years, they are fighting back hard. And they are now using these phony front groups to funnel hundreds of millions of dollars in negative ads all across the country, distorting the records of Democrats. And you know what? They are not even willing to disclose where the money is coming from. You don’t know. Could be from insurance companies. Could be from oil companies. Could be from Wall Street banks. You don’t know.
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Because of you, there’s somebody here in Rhode Island somewhere who is going to be able to get their treatment for cancer without having to give up their house or go bankrupt. Because of you, there are folks -- small businesses right here in New Hampshire -- who are able to keep their doors open in the depths of recession.
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We had made sure that mortgage fraud was actually policed, that credit card companies couldn’t abuse their customers. We expanded national service larger than any expansion since the Peace Corps. And this was all before we started tackling some of the enormous issues that we tackled like health care reform and financial regulatory reform.
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And we rolled up our sleeves and put together a set of rules that allow for innovation in the financial markets, that allow Wall Street to do well, but not at somebody else’s expense -- make sure that we’ve got consumer protections, make sure there aren’t taxpayer bailouts, make sure that if one company goes under, it’s not too big to fail because we’ve got a mechanism to let them go into bankruptcy without bringing the entire financial system down with it.
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But ultimately we got those changes done because we had leaders in Congress who were willing not just to put their fingers up to the wind but instead were committed to doing what was right. And we’re going to need more of that in not just the next couple of years but for the next decade if we want to make sure that finally we are positioning ourselves so that our kids can live out the American Dream, and we’re handing an America off that is stronger than the one we inherited.
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We don't want to keep giving tax breaks to companies that ship jobs overseas. We want to give tax breaks to companies that are investing right here in Charlottesville, right here in Virginia, to small businesses and American manufacturers and clean energy companies. I don't want solar panels and wind turbines and electric cars made in Europe or made in Asia. I want them made here in the United States of America with American workers. That's the choice in this election.
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So I need you guys to keep on fighting. Tom needs you to keep on believing. In these last four days, I need you to knock on doors and make phone calls and talk to your neighbors and vote because if you're willing to step up to the plate, we won’t just win this election, we won’t just send Tom back to Congress, but we will rebuild this middle class. And we will put people back to work. And we will reclaim the American Dream for future generations.
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Now, I don’t believe that government can or should guarantee the success of this company or any company. I don’t think Bob or any business owner expects government to guarantee success. Success has to be earned. It has to be earned the old-fashioned way through great ideas and hard work and great employees. That’s the American way.
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Since I took office, we’ve cut taxes for small businesses 16 times -- 16 different tax cuts for small businesses. Instead of providing tax breaks for companies that are shipping jobs overseas, we’re giving tax breaks to encourage companies to invest right here in the United States of America -- in small businesses, in clean energy firms, in manufacturers, in businesses like this one. And we’ve taken steps to expand lending to small businesses, which, even with good credit, continue to have difficulty borrowing the capital they need to grow.
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It’s been just over one month since I signed the Small Business Jobs Act into law. And in that month, just one month, through just one provision in that bill, the Small Business Administration, the SBA, has supported nearly $3 billion in new loans to more than 5,000 small businesses across the country. That’s fast. And we expect that when all is said and done, these steps will help support tens of billions of dollars in loans to our entrepreneurs so they can expand, they can grow, and they can hire new workers in communities like this one.
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And the idea I’m advancing today is one that both Democrats and Republicans should be able to support. In fact, Republicans have actually offered this idea in the past. It’s a simple proposal that will make a serious difference for this company and others like it. It will encourage business investment right now. It will create jobs right now. It will help our economy grow right now. And when many of our friends and neighbors are still navigating through some tough times, that’s what America needs right now.
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I want to thank the first-time voters and Temple University Young Democrats -- for all the great work you guys have done. And give it up for Quincy Lyons for the great job he’s doing organizing.
Now, I am not here to give a long speech, because I want everybody out there, not in here. I’m here to deliver two messages.
The first message is thank you, because not only did all of you mobilize, organize and energize in 2008 to help send me to the White House -- but over the last two years, so many of you have continued to be involved each and every day to make sure that we could keep moving this country forward. It’s because of you that young people are getting college scholarships that weren’t getting it before.
It’s because of you that young people can now stay on their parents’ health insurance till they’re 26 -- and folks who have health insurance aren’t dropped by insurance companies when they get sick.
And the fact that -- and it’s because of you that we’re also going to be able to fund AIDS. It’s because of you that we are going to be in a position to make sure that each and every person out there is able to find work after a devastating economic crisis that made such a difference to so many families all across this country.
Now, here’s the thing, though, guys. You cannot stop now, because the fact of the matter is we are in a difficult election. It’s difficult here in Pennsylvania. It is difficult all across the country.
And unless each and every one of you turn out, and get your friends to turn out, and get your families to turn out, then we could fall short, and all the progress that we’ve made over the last couple of years can be rolled back.
So the key right now is not just to show up here, it’s not just to listen to speeches. It’s to go out there and do the hard work that's going to be required to bring this home over the last few days. That's going to be the key.
And so I know that some of you may have been at the rally we had with 20,000 folks of Germantown. But you know what, coming to a rally, that's not the hard part. What I need this weekend is 20,000 doors knocked on by all the volunteers who are here today. Is that something that you think you can do, 20,000?
In order for Joe Sestak to be successful and Dan Onorato to be successful and the entire Democratic ticket to be successful, you're going to need to talk to folks everywhere you can and make sure that you describe to them the future that you see for this country.
You want a country where every young person can get a decent education. You want a country where nobody is bankrupt because they get sick. You want a country where our seniors can retire with dignity and respect, and Social Security is there not just for this generation but for future generations.
You want a country that has the best infrastructure in the world. We used to be number one. We can’t have the best rail lines and the best airports built in China or Singapore. They need to be right here in the United States of America.
We don't want to be falling behind in math and science and technology. We’ve got to be first in research and development and technology to make sure that the new products and new services are developed right here in the United States.
We want clean energy here. We don't want solar panels and wind turbines and electric cars built in China or Europe. We want them built here in the United States with American workers.
And so it is absolutely critical that you go out there and you describe your hopes for the future, especially the young people here, because this election is not just going to set the stage for the next two years. It’s going to set the stage for the next 10, for the next 20.
And for those of you who were so excited two years ago, I just want to remind you this. Two years ago was not about me. It was about you and it was about this country. And I said then that change was going to be hard. Now, we’ve been involved in some tough fights over the last two years. We can’t move backwards now. We’ve got to keep moving forward now. And that's all going to be up to you.
So I want everybody to get out there, knock on doors, make phone calls, volunteer, talk to your friends, talk to your neighbors, go into the beauty shops, go into the barber shops, when you’re in church or -- you know, this weekend, I want everybody to be talking about -- have folks voted.
If you do that, then I am confident we’re not just going to win this election but we’re going to keep on moving this country forward so that the American Dream is accessible for everybody, not just some.
Thank you very much, Philadelphia. I love you. God bless you. Let’s get busy. Let’s go to work. Thank you.
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We don't want to keep giving tax breaks to companies that ship jobs overseas. We want those tax breaks to go to companies that are investing here in Bridgeport, small businesses and American manufacturers and clean energy companies, because we don't want electric cars or solar panels or wind turbines made in China or Asia or in Europe. We want them made right here in the United States of America -- with American workers. That's the choice in this election.
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I promise you -- and I promise you this, if you bring that spirit over the next few days, if you are knocking on doors, if you are making phone calls, if you’re going to barbershops and the beauty shops and talking to your friends and talking to your neighbors, if all the young people who came out in 2008 say, “Yes, we can!” again, I promise you we will not just win an election -- we are going to restore this economy. We are going to rebuild our middle class. We are going to deliver the American Dream -- to the next generation, and the generation after that, and the generation after that, all the way into the distant future.
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On the economic front, I reiterated to the Prime Minister how important the Asia Pacific region is to our economy and to world economic growth. Australia is a central player in that economy. And so we are going to continue to explore ways that we can work together to expand trade, expand investment, ensure that everybody is playing by the rules of the road in the region, and cooperating effectively. The Trans-Pacific Partnership is a good example of the kind of collaboration between our two countries that I think can expand opportunity for all peoples.
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Just two years ago, this seemed impossible. In fact, there were plenty of doubters and naysayers who said it couldn’t be done, who were prepared to throw in the towel and read the American auto industry last rites. Independent estimates suggested, however, that had we taken that step, had we given up, we would have lost more than 1 million jobs across all 50 states. It would have also resulted in economic chaos, devastating communities across the country and costing governments tens of billions of dollars in additional social safety net benefits and lost revenue.
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So these last two years haven’t been easy on anybody. They haven’t been without pain or sacrifice, as the tough restructuring of GM reminds us. And obviously we’ve still got a long road ahead and a lot of work to do -– to rebuild this economy, to put people back to work, to make America more competitive for the future and to secure the American Dream for our children and our grandchildren.
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And that left Joe and I with some tough choices. One was to help the auto industry restructure. And that wasn’t an easy call. I understood that there were some reservations of those who said that the industry should pay a price for some poor decisions by the part of management. But we also knew that millions of jobs hung in the balance. We also knew that the very survival of places like Kokomo were on the line. And we knew that the collapse of the American auto industry would lead to an even deeper disaster for our economy.
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There were those who were prepared to give up on Kokomo and our auto industry. There were those who said it was going to be too difficult, or that it was bad politics, or it was throwing good money after bad. You remember the voices arguing for us to do nothing. They were pretty loud, suggesting we should just step back and watch an entire sector of our economy fall apart.
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But we knew that the auto industry was not built, and this country was not built, by doing the easy thing. It wasn’t built by doing nothing. It was built by doing what was necessary even when it’s difficult. So we made the decision to stand behind the auto industry -- if automakers, if CEOs like Sergio were willing to do what was necessary to make themselves competitive in the 21st century, and if they have the cooperation of workers who were taking pride in the products that they made.
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You know, long before transmissions were coming off the line at this plant -– and by the way, you look at these transmissions today and somebody 20 years ago or 10 years ago might not recognize them -- they’re amazing. Before Henry Ford built the Model T or Walter Chrysler took up the reins at a start-up called Buick, a man by the name of Elwood Haynes decided to do a little experiment right in Kokomo.
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To bring Kokomo back, to bring the automobile industry back, we knew we had to change things. We couldn’t just keep doing the things the way we did. We knew the auto industry had to get leaner, had to get tougher, had to be more competitive. And we insisted that they did. And now you see the result -- an old industry adapting to a whole new era, competing again, leading again, and most importantly, hiring again. Hiring again.
, I know you know this, but the last year of the last outfit we succeeded, they lost 461,000 automobile-related jobs. And so far we’ve created almost 75,000 new jobs, and a lot more to come.
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And, folks, look, the government didn’t do this. The government didn’t do this alone. The government did was it was supposed to do. With the leadership of a President and leadership from the President, we had investment from the private sector brought onboard because the government was able to get back in the game and said we’re part of it. The auto industry has roared back in America.
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After all, small businesses and families are tightening their belts. Their government should, too. And that’s why, on my first day as President, I froze all pay for my senior staff. This year I’ve proposed extending that freeze for senior political appointees throughout the government and eliminating bonuses for all political appointees.
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And today I’m proposing a two-year pay freeze for all civilian federal workers. This would save $2 billion over the rest of this fiscal year and $28 billion in cumulative savings over the next five years. And I want to be clear: This freeze does not apply to the men and women of our Armed Forces, who along with their families continue to bear enormous burdens with our nation at war.
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Going forward, we’re going to have to make some additional very tough decisions that this town has put off for a very long time. And that’s what this upcoming week is really about. My hope is that, starting today, we can begin a bipartisan conversation about our future, because we face challenges that will require the cooperation of Democrats, Republicans and Independents. Everybody is going to have to cooperate. We can’t afford to fall back onto the same old ideologies or the same stale sound bites. We’re going to have to budge on some deeply held positions and compromise for the good of the country. We’re going to have to set aside the politics of the moment to make progress for the long term. And as I’ve often said, we’re going to have to think not just about the next election, but about the next generation, because if there’s anything the American people said this month, it’s that they want their leaders to have one single focus: making sure their work is rewarded so that the American Dream remains within their reach. It would be unwise to assume they prefer one way of thinking over another. That wasn’t the lesson that I took when I entered into office, and it’s not the lesson today.
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I know there are different aspects of this plan to which members of Congress on both sides of the aisle object. That’s the nature of compromise. But we worked hard to negotiate an agreement that’s a win for middle-class families and a win for our economy, and we can’t afford to let it fall victim to either delay or defeat. So I urge members of Congress to pass these tax cuts as swiftly as possible.
Getting that done is an essential ingredient in spurring economic growth over the short run. And spurring economic growth is what I’ll talk about later this morning when I meet with some of America’s top business leaders. That includes Jim McNerney of Boeing, who also heads up my Export Council, and several members of my Economic Recovery Advisory Board. This is one of many discussions we’ll be having in the months ahead to find new ways to spur hiring, put Americans back to work and move our economy forward.
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As I said when I was running for President and as I’ve said since, I believe that the primary engine of America’s economic success is not government. It’s the ingenuity of America’s entrepreneurs. It’s the dynamism of our markets. And for me, the most important question about an economic idea is not whether it’s good short-term politics or meets somebody’s litmus test. It’s whether it will help spur businesses, jobs and growth.
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Our strategy begins with the number one concern for all Americans right now -- and that’s improving the economy and creating jobs. We’ve heard time and again from tribal leaders that one of the keys to unlocking economic growth on reservations is investments in roads and high-speed rail and high-speed Internet and the infrastructure that will better connect your communities to the broader economy. That’s essential for drawing capital and creating jobs on tribal lands. So to help spur the economy, we’ve boosted investment in roads throughout the Bureau of Indian Affairs and the Indian Reservation Road Program, and we’ve offered new loans to reach reservations with broadband.
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I also want to note that I support legislation to make clear -- in the wake of a recent Supreme Court decision -- that the Secretary of Interior can take land into trust for all federally recognized tribes. That’s something that I discussed yesterday with tribal leaders.
We’re also breaking down bureaucratic barriers that have prevented tribal nations from developing clean energy like wind and solar power. It’s essential not just to your prosperity, but to the prosperity of our whole country. And I’ve proposed increasing lending to tribal businesses by supporting community financial institutions so they can finance more loans. It is essential in order to help businesses expand and hire in areas where it can be hard to find credit.
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As soon as I sign this legislation, 2 million Americans looking for work who lost their jobs through no fault of their own can know with certainty that they won’t lose their emergency unemployment insurance at the end of this month. Over the past few weeks, 600,000 Americans have been cut off from that lifeline. But with my signature, states can move quickly to reinstate their benefits –- and we expect that in almost all states, they’ll get them in time for Christmas.
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Now, candidly speaking, there are some elements of this legislation that I don’t like. There are some elements that members of my party don’t like. There are some elements that Republicans here today don’t like. That’s the nature of compromise -– yielding on something each of us cares about to move forward on what all of us care about. And right now, what all of us care about is growing the American economy and creating jobs for the American people. Taken as a whole, that’s what this package of tax relief is going to do. It’s a good deal for the American people. This is progress. And that’s what they sent us here to achieve.
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And the final product proves when we can put aside the partisanship and the political games, when we can put aside what’s good for some of us in favor of what’s good for all of us, we can get a lot done. And if we can keep doing it, if we can keep that spirit, I’m hopeful that we won’t just reinvigorate this economy and restore the American Dream for all who work for it. I’m also hopeful that we might refresh the American people’s faith in the capability of their leaders to govern in challenging times, belief in the capacity of their institutions in this town to deliver in a rapidly changing world, and, most of all, confidence that our best days as a nation are still ahead of us.
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China is one of the top markets for American exports. We’re now exporting more than $100 billion a year in goods and services to China, and that supports about half a million American jobs, from manufacturing to agriculture. And in fact, our exports to China are growing nearly twice as fast as our exports to the rest of the world.
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The trade and investment cooperation between our two countries have indeed brought real benefits to the people of our countries and important business communities -- opportunities for our business communities.
According to figures, our total trade has brought about $60 billion U.S. of benefits to U.S. consumers.
If we look ahead to the future, our trade cooperation enjoys a promising future. Here I have a message to all of you -- that is, China is speeding up this transformation of economic growth pattern and economic restructuring. We are focusing our efforts to boosting domestic demand, especially consumer spending.
In recent years, China’s domestic spending has been growing at a double-digit rate every year. In 2010, our domestic market has surpassed a scale of $2 trillion U.S. And here in the United States, you are also working all-out to stimulate your economy.
President Obama has launched a program to double your exports. Both in the dinner last night and in my meeting with President Obama just now, we discussed how to advance economic cooperation between our two countries across the board.
We agreed to strengthen our cooperation in the financial, economic, trade and the environment, science and technology, agriculture, infrastructure and many other fields.
So, indeed, there is a promising future for trade and investment cooperation between our two countries. I do hope that companies from both countries can seize the opportunities, take active options and achieve great things.
I also have a message to American entrepreneurs. That is, we welcome you as companies to China. China follows reform and opening up. We will, as always, try to provide a transparent, just, fair, highly efficient investment climate to U.S. companies and other foreign companies.
I also wish to tell you that all companies registered in China are given national treatment. In terms of innovation products, accreditation, government procurement, IPR protection, the Chinese government will give them equal treatment.
Here, I also have a message to Chinese entrepreneurs. That is, the Chinese government will, as it has always done, support you in making investments and doing business here in the United States. I hope that you can continue to be enterprising and creative, and at the same time, don’t forget to give back to the local communities.
I do believe that President Obama and the U.S. administration will provide a level playing field for Chinese companies to make investments here in the United States.
To conclude, I wish the companies you represent even greater growth in the new year. And I also expect that you can make even greater contribution to promoting trade and investment cooperation between our two countries.
And now I’m ready to listen to your views. Thank you.
END
12:46 P.M. EST
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Three decades ago, on a January day like this, another American President stood here and welcomed another Chinese leader for the historic normalization of relations between the United States and the People’s Republic of China. On that day, Deng Xiaoping spoke of the great possibilities of cooperation between our two nations.
Looking back on that winter day in 1979, it is now clear. The previous 30 years had been a time of estrangement for our two countries. The 30 years since have been a time of growing exchanges and understanding. And with this visit we can lay the foundation for the next 30 years.
At a time when some doubt the benefits of cooperation between the United States and China, this visit is also a chance to demonstrate a simple truth. We have an enormous stake in each other’s success. In an interconnected world, in a global economy, nations -- including our own -- will be more prosperous and more secure when we work together.
The United States welcomes China’s rise as a strong, prosperous and successful member of the community of nations. Indeed, China’s success has brought with it economic benefits for our people as well as yours, and our cooperation on a range of issues has helped advance stability in the Asia Pacific and in the world.
We also know this: History shows that societies are more harmonious, nations are more successful, and the world is more just, when the rights and responsibilities of all nations and all people are upheld, including the universal rights of every human being.
, we can learn from our people. Chinese and American students and educators, business people, tourists, researchers and scientists, including Chinese Americans who are here today —- they work together and make progress together every single day. They know that even as our nations compete in some areas, we can cooperate in so many others, in a spirit of mutual respect, for our mutual benefit.
What Deng Xiaoping said long ago remains true today. There are still great possibilities for cooperation between our countries. President Hu, members of the Chinese delegation, let us seize these possibilities together. Welcome to the United States of America. Hwan-ying.
PRESIDENT HU: (As translated.) , Mrs. Obama, ladies and gentlemen, dear friends, it gives me great pleasure to come to Washington and pay a state visit to the United States at the beginning of the new year, at the invitation of President Obama. At this point in time, let me extend, on behalf of the 1.3 billion Chinese people, sincere greetings and best wishes to the people of the United States.
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Now, nobody understands this better than Jeff Immelt. He understands what it takes for America to compete in the global economy. As he mentioned, I’ve appreciated his wisdom during these past two years. We had a difficult, difficult crisis on our hands. It was a few days after I took office that I assembled a group of business leaders, including Jeff, to form a new advisory board, because at that time the economy was in a freefall and we were facing the prospects of another Great Depression, with ripple effects all around the world. It wasn’t just the United States. The entire world economy was contracting. At such a dangerous moment, it was essential that we heard voices and ideas from business leaders and from experts who weren’t part of the usual Washington crowd.
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The future is ours to win. But to get there, we can’t just stand still. As Robert Kennedy told us, “The future is not a gift. It is an achievement.” Sustaining the American Dream has never been about standing pat. It has required each generation to sacrifice, and struggle, and meet the demands of a new age.
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To reduce barriers to growth and investment, I’ve ordered a review of government regulations. When we find rules that put an unnecessary burden on businesses, we will fix them. But I will not hesitate to create or enforce common-sense safeguards to protect the American people. That’s what we’ve done in this country for more than a century. It’s why our food is safe to eat, our water is safe to drink, and our air is safe to breathe. It’s why we have speed limits and child labor laws. It’s why last year, we put in place consumer protections against hidden fees and penalties by credit card companies and new rules to prevent another financial crisis. And it’s why we passed reform that finally prevents the health insurance industry from exploiting patients.
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Now, I have heard rumors that a few of you still have concerns about our new health care law. So let me be the first to say that anything can be improved. If you have ideas about how to improve this law by making care better or more affordable, I am eager to work with you. We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses.
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America needs to get behind entrepreneurs like Neal. We need to get behind clean energy companies like Orion. We need to get behind innovation. That’s how we’ll meet the goal I set last night and make sure 80 percent of America’s electricity comes from clean energy sources by 2035. That is a goal that we can meet. That is a goal we must meet. (Applause. That’s how we’ll make America the first country to have 1 million electric vehicles on the road by 2015. In five years, a million electric cars on the road. That’s how America will lead the world in clean energy. And as I’ve said before, the nation that leads the world in clean energy will lead the global economy in the 21st century.
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So that’s what sets Neal apart. That’s what sets Orion apart. But that’s also what sets America apart. That’s what sets America apart. Here in America, we play to win. We don’t play not to lose. And part of what I wanted to communicate last night is, having gone through a tough time, having gone through a recession, having seen so many jobs lost, having seen the financial markets take a swoon, you get a sense that a lot of folks have been feeling like, well, we’ve just got to play not to lose.
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Now, for most families, that freedom requires a job that pays the bills, covers your mortgage, helps you look after your children. It means a chance to send those children to college, save enough for retirement. And it means access to quality, affordable health care. That is part of the American Dream.
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And so I’m willing to work with anyone, Republican or Democrat, to make care better or to make their health care more affordable. I’ve even suggested we begin by correcting what was a legitimate concern, a flaw, in the legislation that placed unnecessary bookkeeping burdens on small businesses. I’m open to other ideas, including patient safety innovations and medical malpractice reform.
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We've got small business owners like Janine Vaughn of Spokane, Washington. Janine always tried to do the right thing and cover her workers. But she explained, “We’re a small business. We care about everybody who works here.” But over the last 12 years, her premiums have tripled, so that was eating away at her profit margin.
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So let’s look at what’s happened over the last 10 months. Not only has the economy grown and added jobs since the Affordable Care Act became law, but small businesses across the country have already chosen to offer health care to hundreds of thousands of their employees, many for the first time. That’s something that regardless of politics, we should all celebrate.
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Health reform is part of deficit reform. We know that health care costs, including programs like Medicare and Medicaid, are the biggest contributors to our long-term deficit. Nobody disputes this. And this law will slow these costs. That’s part of the reason why nonpartisan economists, why the Congressional Budget Office, have said that repealing this law would add a quarter of a trillion dollars to our deficit over the next decade, and another trillion dollars to our deficit in the decade after that. They’re not just making this up. And what’s more, repeal would send middle-class premiums up, would force large employers to pay that extra $2,000-$3,000 per worker, and shift control of your health care right back to the insurance companies.
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So the time for fighting the battles of the last two years has now passed. It’s time to move forward. And these efforts -– strengthening our families, getting our fiscal house in order, allowing small businesses to grow, allowing entrepreneurs to strike out on their own free from crushing costs –- they’re critical to our economic success. And by reforming our health care system so it doesn’t dictate anybody’s economic fate, America can decide its own.
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So we can’t win the future if we lose the race to educate our children. Can’t do it. In today’s economy, the quality of a nation’s education is one of the biggest predictors of a nation’s success. It is what will determine whether the American Dream survives. And so it’s the responsibility of all of us to get this right: parents, teachers, students, workers, business and government. We’re all going to have to focus on this like a laser.
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The truth is, is that large companies are critically important to our economy. They export. They employ thousands of people. And they also provide contracts to small businesses. So there’s a little bit of an artificial separation sometimes -- if large businesses are doing well, then small businesses also have an opportunity for great success.
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But here’s the unique thing about small businesses. Small businesses that grow into medium-sized and large businesses, that’s the key to the future, because it’s the new products, it’s the new services, things that nobody else thought of before that are going to help absorb all the talented Americans out there who are looking for careers, and the large companies, there’s only going to be so much additional employment that they add, partly because they’re getting more and more efficient.
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And as I said, we’re very lucky to have Steve Case here, who is somebody who grew a small business to a large business and was at the cutting edge of the technological revolution that we’ve seen over the last 20 years that has changed everything. And he is going to be working as our chairman for public/private partnership that tries to continue to encourage additional entrepreneurship.
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And my recommendation to you, , would be that if you could figure out a way to change the tax policy so that when people invest in small businesses, perhaps the capital gains on an investment would perhaps be not taxed. Let’s say if you put in $10,000 or $20,000, if you doubled your investment the first $20,000 would be --
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MS. MILLS: Well, in fact, in the set of tax cuts that the President enacted -- the 17 tax cuts -- I want to make sure you all, when you do your taxes, make sure you ask about the 17 tax cuts because it’s money back in your pocket. One of them is if you invest in a small business, certain criteria, you don’t pay capital gains. You don’t pay capital gains.
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Good. Well, this access to capital issue is going to, I suspect, keep on coming up. Obviously one of the key things that we’ve done -- and I’ll talk about this in another panel that I’ll be joining -- is both through the SBA, where we expanded the loan guarantee program, increased the size of loans that could be taken out and reduced fees, that is providing a lot of capital, particularly at a time when small businesses were getting hammered during this past two years of recession.
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MR. LOPEZ: -- to get paid. , when it costs us, whether it’s $30,000 or $50,000 or $100,000 a week in payroll and we’re waiting nine or 10 weeks later to get paid, and the margin is so small, we can’t grow, although we have the right deliverables and the right skill sets and the right talent to a point that we want to grow the business and have other investors, European investors, that we want to carry their products and to do -- go national.
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I think the other problem is that being a contractor we’re very successful through the SBA program, through the SBA office here -- very successful and we did very well with that. Some of the issues that I have with that, or I think most people, is that same thing -- the government takes their time, you’re making payroll, putting your process through the --
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MS. MILLS: Absolutely. That’s something that we do quite a bit of in bank lending and in SBA lending. So those are some of the avenues that we can talk about in order to make sure there’s more working capital. I hear all the time that working capital for growth is as hard to get as any other kind of capital. And we’re doing a very good job right now on real estate lending and on equipment capital, and we’re working hard on working capital as well.
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One of the things, though -- I want to underline what the President said about what he said to everyone in the Cabinet about small business contracting. He has told all of us around the table that the small business contracting programs are a real big priority, and that we know that gives oxygen into your revenue lines. And we also know that it’s good for the agencies because they get the most innovative entrepreneurs working for them. And usually the CEO is right there at the table helping them out.
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So this is something that everybody across the administration under the President’s leadership is pushing forward on, and I hope that lots of you work with us at the SBA to get qualified to bid on these contracts because I there’s going to be a really good positive momentum in government contracting for small business going forward. And they’re going to pay on time.
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And so it’s not good enough just to rely on the old industries. We’ve also got to invent new ones, and that’s what you’re doing here. Over the last several months, I’ve visited with organizations like the Chamber of Commerce. I’ve traveled to large companies -- just recently I went to Intel because it’s doubling down on America, it’s investing in new plants and equipment and amazing facilities. And those large companies, those large institutions are important to our success. But the truth is, when it comes to our economy, it’s our small businesses that pack the biggest punch, especially when it comes to employment, which is obviously one of the biggest challenges that we faced coming out of this Great Recession that we had.
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We had a terrific discussion. The groups that I participated in were remarkable and had great ideas. I know the members of the Cabinet had fun, which is why we’re going to do it again. And over the next several months, what we’re going to be doing is teaming up with mayors and governors and small business owners to host a series of these jobs forums across the country.
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I should mention just a couple of things that we heard during some of these breakout sessions. Obviously there was a lot of emphasis on capital. And we talked about the SBA programs, the Treasury programs that are in place some people may not be aware of that are making a huge difference in providing financing to a lot of startups and a lot of small businesses across the country.
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But we also heard from you about some important ideas. For example, right now we’re already giving a tax break, zero percent on capital gains for investors who invest in small businesses. But a few of you said that that works well. What we could also really use is some tax credits for angel investors because that early financing oftentimes may be what makes or breaks a company.
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Just a couple examples of folks who are here: Dr. Albert Green, the CEO of Kent Displays. Is Albert here? Where is he? There he is, Doc. His company is a product of one of NorTech’s clusters -– the Flex Matters Cluster. And that cluster is working to make Cleveland the global epicenter for the development and manufacturing of flexible electronics –- the printing of electronic devices on materials that can bend and flex, like clothing and tablets and medical implants. And we gave them a boost with a contract from the Small Business Administration so they can counsel the small businesses that spring from this cluster on things like patents and exporting, and getting these revolutionary products to market faster.
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So you guys are leading the way, and we know there are some things government can do to help clear the way for your success. We can make sure America remains the best place on Earth to do business by knocking down barriers that stand in the way of your growth. That’s why we passed 17 different tax cuts for small businesses, why I proposed lowering the corporate tax rate and eliminating unnecessary regulations to help larger businesses create jobs.
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I think Tim did extraordinary work in our first two years to make sure that the capital markets sort of regained some sense of normalcy. But what we’re well aware of is that if you’re a big company, it’s very easy to borrow right now, and you can borrow very cheaply. If you’re a medium-sized company, you may be doing okay. If you’re a small business, capital is still tough -- partly, as I understand it, because one of the key ways that small businesses were able to get loans was because it had some sort of assets that they could offer up as collateral. And if those asset values have declined, that makes it that much more difficult. And small community banks that were the source of a lot of lending for small businesses are still working their way through some problems. Many of them were involved in the real estate market one way or another, and that creates difficulties, as well.
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So we know we still have some challenges. I assume that Tim has already described to you what we’re doing both on the SBA side and at Treasury to try to loosen up capital for entrepreneurs and business people like yourselves. But with that, we’re interested in finding out in more detail where you think we can be most helpful.
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Obviously the big companies generally get most of the attention in our economy, and the success of large companies is critical to the success of medium and small businesses as well. But it’s small businesses like yours that help drive America’s economic growth and create two out of every three new jobs.
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You’re the anchors of our Main Streets, small businesses built by folks who live and work in the community and look out for one another that end up determining success or failure of cities and towns. They’re the cornerstones of America’s promise, the idea that if you’ve got a dream and you’ve got the work ethic to see it through, you can succeed. And when our small businesses do well, then America does well.
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That’s why we convened this Winning the Future Forum for Small Business. Along with Cleveland State and local organizations like JumpStart and NorTech, we looked for entrepreneurs here in Northeast Ohio who live to out-hustle, to out-innovate everybody else -– in manufacturing and construction, in clean energy and biotech, in retail, in restaurants -– including the owner of Bubba’s BBQ, who I imagine will be one of the more popular participants today.
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We’re here to hear from you directly. We want your stories -– your successes, your failures, what barriers you’re seeing out there to expand, what you’ve learned along the way. What would make it easier for you to grow? What would make it easier for you to create new jobs? How can America help you succeed so that you can help America succeed?
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Well, Cleveland I think is a great example of cities all across the country, but especially in the Midwest, who are starting to reinvent themselves. These are typically manufacturing cities. They were built on the auto industry, on heavy manufacturing, steel. And as manufacturing has become much more productive, fewer workers are in manufacturing -- even though manufacturing continues to contribute a lot to the economy -- and so these regions are having to think what’s going to be the businesses of the future that end up employing more people and providing more opportunity. And small businesses are going to be the ones that I think are going to be making the biggest impact on regions like this one -- a lot of risk-takers, a lot of entrepreneurs here.
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MR. GOOLSBEE: -- that we were going to shoot to you. James in Addison, Texas: With the virtual death of local banking, it’s next to impossible today to get bank loans for anything other than fixed assets. For working capital, speculative funding, for others, entrepreneurs must look to save capital, family, friends, or even a first customer. Traditional financing sources only help the more traditional forms of business. Innovators must look elsewhere. We're locked in this and we were wondering what your view is.
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And so what we did over the last two years was try to make sure that the Small Business Administration, the SBA, filled some of this hole. We increased the guarantees that SBA would provide to banks if they loaned -- if they made a loan to a small business. We eliminated some of the fees that might be required. And as a consequence, volume from the Small Business Administration went up substantially.
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The other thing that we did was we increased the limits on the loans that might be provided through the SBA. So the SBA has done a lot of good work. The Treasury Department has also tried to make sure that they set up funds that would help to facilitate lending to small businesses. That's especially important in part because small businesses a lot of times have trouble getting loans when their collateral has gone down, the value of their holdings have gone down. And typically that's been real estate for a lot of small businesses.
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So we got a range of products that, through the SBA, through Treasury, are providing loans to small businesses, helping encourage small banks to get back into the business of lending again. But we heard some good ideas here today about, for example, providing tax credits for angel investors -- that right now there have been some discussions in Congress about setting up some additional legislation that could help small businesses, and we’re going to see if we can implement it.
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Generally speaking, though, the -- what I’ll do is just talk about what I’ve heard in some of these forums. In addition to financing, I think the other thing that people really wanted to find out is how can they get mentored and partner with some larger businesses. And we’re very lucky we got Steve Case here who obviously used to be with AOL. He has agreed to be the chairman of our sort of umbrella organization that is Startup America, which is going to help to mentor and partner with would-be entrepreneurs -- get them with more mature businesses, medium-sized business, large businesses.
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The main message I want to deliver tonight, in addition to asking you to have some fun this evening, is to know that you’ve got a partner here in the White House. If you look around the room, we come from a lot of different parts of the country and people may have different perspectives, but one thing that we all absolutely share is the belief in the American Dream and the confidence that when our people get opportunities, they’ve got the ingenuity and the stick-to-it-ness and the drive to succeed.
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We meet at a moment when all of us -- Democrats and Republicans, leaders at the national and the state levels -- face some very big challenges. Our country has come through a long and wrenching recession. And as we recover, the question we’re going to have to answer is: Where will the new jobs come from? What will the new sources of economic growth be? And how can we make sure that the American Dream remains a reality into the 21st century?
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Now, in the short term, we came together here in Washington at the end of last year and enacted tax cuts that are already making Americans’ paychecks bigger and are allowing businesses to write off major investments. These are tax cuts and changes in the tax credit system that are going to spur job creation and economic growth, and I’m proud that Democrats and Republicans worked with each other to get it done.
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In the long term, however, we need to address a set of economic challenges that, frankly, the housing bubble largely papered over for almost a decade. We now live in a world that’s more connected and more competitive than ever before. When each of you tries to bring new jobs and industries to your state, you’re not just competing with each other, but you’re competing with China, you’re competing with India, you’re competing with Brazil, you’re competing with countries all around the world.
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But over the last decade, Brazil has proved to the world that there is another way. You’ve shown that participation in the global economy can lead to widespread opportunity at home. You’ve shown that the spirit of capitalism can thrive alongside the spirit of social justice. You’ve shown that democracy is still the best path to economic progress, for when governments are accountable to their people, their people are more likely to prosper.
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For example, after one small business in North Carolina attended a trade forum in São Paulo last year, they came away with a manufacturing deal that sent auto parts to Brazil and led to the hiring of new workers in the United States. Capstone Turbine in California recently sold $2 million worth of high-tech energy equipment that will support jobs in America and serve millions of Brazilians in the years to come. And the government of Brazil recently purchased helicopters that will support U.S. manufacturing jobs from Pennsylvania to Alabama.
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In the United States, we believe in what’s known as the American Dream -– the idea that no matter who you are, or where you come from, or how you start out, you can overcome the greatest obstacles and fulfill the greatest hopes. I’m a testament to that dream. I believe that that dream exists in this America, as well. I can see it in the entrepreneurial spirit of the men and women in this room. I could see it in the celebrations of Caricoas upon learning that the world will come to compete in Rio. And I can see it running through so much of your history.
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Together we can advance our common prosperity. As two of the world’s largest economies, we worked side by side during the financial crisis to restore growth and confidence. And to keep our economies growing, we know what’s necessary in both of our nations. We need a skilled, educated workforce -- which is why American and Brazilian companies have pledged to help increase student exchanges between our two nations.
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In a global economy, the United States and Brazil should expand trade, expand investment, so that we create new jobs and new opportunities in both of our nations. And that's why we're working to break down barriers to doing business. That's why we're building closer relationships between our workers and our entrepreneurs.
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And despite this region’s democratic progress, stark inequalities endure. In political and economic power that is too often concentrated in the hands of the few, instead of serving the many. In the corruption that too often still stifles economic growth and development, innovation and entrepreneurship. And in some leaders who cling to bankrupt ideologies to justify their own power and who seek to silence their opponents because those opponents have the audacity to demand their universal rights. These, too, are realities that we must face.
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We’re also encouraging the next generation of businesses and entrepreneurs. So we’ll work with the Inter-American Development bank to increase lending. We’ve expanded credit under a new Microfinance Growth Fund for the Americas. We’re supporting reforms to tax systems, which are critical for economic growth and public investment. We’re creating new “Pathways to Prosperity” -- microcredit, entrepreneurship training -- for those who must share in economic growth, including women and members of Afro-Caribbean and indigenous communities.
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It’s the same philosophy behind two additional initiatives that I’m announcing today, which will help our countries educate and innovate for the future. First, we’re launching a new initiative to harness the power of social media and online networks to help students, scientists, academics and entrepreneurs collaborate and develop the new ideas and products that will keep America -- the Americas competitive in a global economy.
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Fortunately for El Salvador, it enjoys the wise leadership of President Funes. , I want to commend you for your courageous work to overcome old divisions in Salvadoran society and to show that progress comes through pragmatism and building consensus. You’ve articulated a vision of economic growth and social progress that is inclusive of all segments of Salvadoran society. And I want to make it clear today that the United States wants to be a partner with El Salvador in this process. We want El Salvador to be successful.
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At the same time, we need to increase trade and economic growth across Central America. I very much appreciated the President’s insights on the region. Today I’m pleased to announce a new effort -- our Crossroads Partnership. We’ll work with countries in the region to make borders more efficient and more secure so we’re encouraging trade and economic growth rather than constraining it.
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One of the strengths of America, compared to other countries, is that we’re always attracting new talent to our shores -- people who reinvigorate the American Dream. And that has to continue in this generation. And so they should know, these young people should know that they have a President who believes in them and will continue to fight for them and try to make sure that they have full opportunities in this country.
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There have been times where we had to make some really tough decisions, really unpopular decisions, digging ourselves out of this incredible economic hole that we were in. We had to stabilize the financial system. That wasn’t always popular. We had to save the U.S. auto industry, and everybody said that wasn’t going to work. And I just want to report that GM just announced it’s hiring every single one of the workers that they laid off before we took office.
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So we've gotten a lot of stuff done. But right now what’s on my mind is what hasn’t gotten done yet. We're going to have to fix a broken immigration system, and that is not yet complete. We've got to make sure that even as we're securing our borders we also recognize that we are a nation of immigrants and that we want everybody to be able to partake in the American Dream.
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That’s why he invested so much time and energy in Africa. It’s why he argued that economic progress and human rights can’t be separated. That’s why he called commerce and economic development the “infrastructure of democracy.” That’s why he was on that flight to the Balkans -- because, he said, just as America “took the lead in the peace process, we need to show the way in rebuilding from the ruins of war.”
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In an economy that relies so heavily on oil, rising prices at the pump affect everybody -– workers, farmers, truck drivers, restaurant owners, students who are lucky enough to have a car. Businesses see rising prices at the pump hurt their bottom line. Families feel the pinch when they fill up their tank. And for Americans that are already struggling to get by, a hike in gas prices really makes their lives that much harder. It hurts.
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Now, here’s the thing -– we have been down this road before. Remember, it was just three years ago that gas prices topped $4 a gallon. I remember because I was in the middle of a presidential campaign. Working folks certainly remember because it hit a lot of people pretty hard. And because we were at the height of political season, you had all kinds of slogans and gimmicks and outraged politicians -- they were waving their three-point plans for $2 a gallon gas. You remember that -- “drill, baby, drill”
-- and we were going through all that. And none of it was really going to do anything to solve the problem. There was a lot of hue and cry, a lot of fulminating and hand-wringing, but nothing actually happened. Imagine that in Washington.
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That has to change. That has to change. We cannot keep going from shock when gas prices go up to trance when they go back down -- we go back to doing the same things we’ve been doing until the next time there’s a price spike, and then we’re shocked again. We can’t rush to propose action when gas prices are high and then hit the snooze button when they fall again. We can’t keep on doing that.
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Now, we went through 30 years where we didn’t raise fuel efficiency standards on cars. And part of what happened in the U.S. auto industry was because oil appeared relatively cheap, the U.S. auto industry decided we’re just going to make our money on SUVs, and we’re not going to worry about fuel efficiency. Thirty years of lost time when it comes to technology that could improve the efficiency of cars.
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We’ll also reduce health care spending, and strengthen Medicare and Medicaid through some common-sense reforms that will get rid of, for example, wasteful subsidies to insurance companies. Reforms that can actually improve care -- like making it easier for folks to buy generic drugs, or helping providers manage care for the chronically ill more effectively. And we can reform the tax code so that it’s fair and it’s simple –- so the amount of taxes you pay doesn’t depend on whether you can hire a fancy accountant or not.
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Now, I wish I could tell you that there was some easy, simple solution to this. It is true that a lot of what’s driving oil prices up right now is not the lack of supply. There’s enough supply. There’s enough oil out there for world demand. The problem is, is that oil is sold on these world markets, and speculators and people make various bets, and they say, you know what, we think that maybe there’s a 20 percent chance that something might happen in the Middle East that might disrupt oil supply, so we’re going to bet that oil is going to go up real high. And that spikes up prices significantly.
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I want to live in a society that’s fair -- not just out of charitable reasons, but because it improves my life. If there are young people out there who are going to good schools and have opportunity, if I’m not driving by and seeing homeless folks on the streets, why wouldn’t I want to have a society where I knew that the American Dream was available for everybody?
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So, for example, they proposed 70 percent cuts in clean energy. Well, I don't know how we free ourselves from dependence on foreign oil -- and anybody who is paying gas prices knows that there’s an economic component to this as well as an environmental component to it -- if we’re not investing in the basic research and technology that allows solar, wind and others to thrive and develop.
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MR. ZUCKERBERG: So the next question is from someone watching Facebook live. Jay Aptine (ph) from Williamsburg, Virginia writes in and asks: “The housing crisis will not go away. The mortgage financing for new homebuyers with low to moderate income is becoming very difficult. As President, what can you do to relax the policies that are disqualifying qualified homebuyers from owning their first home? How can you assure the low to moderate homebuyers that they will have the opportunity to own their first home?”
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Well, it’s a good question. And I’ll be honest with you, this is probably the biggest drag on the economy right now that we have -- along with I know the frustrations people have about gas prices. What we’ve really seen is the housing market, which was a bubble, had greatly over-inflated in all regions of the country. And I know I probably don't get a lot of sympathy about that here because I can only imagine what rents and mortgages you guys are paying.
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I think the regulators are trying to get that balance right. There are certain communities with high foreclosure rates where what we're trying to do is see if can we help state and local governments take over some of these homes and convert them and provide favorable terms to first-time home buyers. But, frankly, I think we've got to understand that the days where it was really easy to buy a house without any money down is probably over. And what we -- what I'm really concerned about is making sure that the housing market overall recovers enough that it’s not such a huge drag on the economy, because if it isn’t, then people will have more confidence, they’ll spend more, more people will get hired, and overall the economy will improve.
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Q Hi, . Thank you so much for joining us today. I am originally from Detroit, Michigan, and now I'm out here working at Facebook. So my question for you kind of builds on some of the things we were just talking about. At the beginning of your term you spent a lot of time talking about job creation and the road to economic recovery, and one of the ways to do that would be substantially increasing federal investments in various areas as a way to fill the void left from consumer spending. Since then, we’ve seen the conversation shift from that of job creation and economic recovery to that of spending cuts and the deficit. So I would love to know your thoughts on how you’re going to balance these two going forward, or even potentially shift the conversation back.
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So those were all investments that we made in the first two years. Now, the economy is now growing. It’s not growing quite as fast as we would like, because after a financial crisis, typically there’s a bigger drag on the economy for a longer period of time. But it is growing. And over the last year and a half we’ve seen almost 2 million jobs created in the private sector.
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And obviously for folks in Detroit, where you’re from, they know that our investments can make a difference because we essentially saved the U.S. auto industry. We now have three auto companies here in America that are all turning a profit. G.M. just announced that it’s hiring back all of the workers that it was planning to lay off. And we did so, by the way, at the same time as we were able to increase fuel efficiency standards on cars for the first time in 30 years. So it can be done, but it takes a balanced approach.
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It hurts because you know every time you go to work a big chunk of your paycheck is being eaten up. And you might already be having trouble making ends meet at the end of the month. So this gas issue is serious. But here’s the problem -- every time it happens, every time gas prices go up like this, like clockwork, suddenly politicians look around and they discover high gas prices. And they’re shocked, and they get in front of TV and they say, we’ve got a three-point plan to bring gas down to two bucks a gallon. And then when gas prices go down, nothing ever happens, and we’re back into the same old patterns, and we don’t have a comprehensive energy strategy for the future.
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Now, there are some things that we can do right now. Last month I asked my Attorney General to look into any cases of price gouging so we can make sure nobody is being taken advantage of at the pump. Today, I’m going to go a step further. The Attorney General is putting together a team whose job it is to root out any cases of fraud or manipulation in the oil markets that might affect gas prices, and that includes the role of traders and speculators. We’re going to make sure that nobody is taking advantage of American consumers for their own short-term gain.
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And here’s why this is so important. Ultimately, this debate is not just about numbers on a page. It’s about the vision we have for our future -- who we are as a country. It’s about making sure that the most you can do here is not just live out your own American Dream, but make sure that the people around you are living out their American Dream as well.
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So we’ve already implemented a wide range of reform. Small businesses are eligible right now for huge tax breaks about a third of what small businesses pay for their employees to provide them health care, now they can deduct from their taxes. And that can save tens of thousands or even hundreds of thousands on their health care bills. That’s already going on right now.
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The other thing that we did in health care reform bears on what I was talking about earlier, which is our deficit reduction. We were giving -- we were giving about $180 billion worth of subsidies to insurance companies under the Medicare program. It wasn’t making seniors healthier, but it was making the profit margins for those insurance companies a lot healthier.
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We think that needs to be part of a overall, comprehensive energy package. And I was talking earlier about electricity generation, but obviously what’s on the minds of a lot of folks right now are gas prices. Let me just make this point: One of the key ways we’re going to get gas prices down is just to use less oil. Right? If you buy less, prices go down.
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There are moments in history that are inflection points, and I think we understood back in 2008 that we were entering into one of those periods. Domestically, we had gone through a decade in which the economy was growing but it was growing on top of a bubble. And people at the very top were doing very well, but the wages and incomes of ordinary families had flatlined, and we were starting as a government to live beyond our means with tax cuts and two wars that weren’t paid for. And so I think people understood even before the recession hit that somehow the way our economy was operating was not conducive to long-term sustained economic growth or making sure that everybody had a chance at the American Dream.
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Now, there’s an example of creativity that we saw during the campaign. You know, it wasn’t always convenient but it’s part of what made 2008 special. And what’s happened -- and I think that was indicative of that performance as well -- is, is that over the last two and a half years, change turned out to be tougher than a lot of us expected. Right? I think a lot of folks didn’t recognize that we might end up going through the worst recession since the Great Depression, and that we’d see 8 million jobs lost, devastating entire communities all across the country. I think we didn’t anticipate a housing crisis that kept on worsening, or the potential of a financial meltdown.
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Some of the decisions we made were not popular. You remember folks talking about the auto bailout. A lot of folks were skeptical -- we should just let the auto industry in America go by the wayside. But two and a half years later, our economy is growing again. We’re creating jobs again. Over the last four months, we’ve seen the largest drop in unemployment since 1984. Over the last 13 months, we’ve added nearly 2 million private sector jobs.
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I admit, Secret Service doesn’t let me pump gas now. But I remember what it was like filling up. And you think about a family that has to drive 50 miles to work. They don't have a choice. That's where their job is. They may not be able to sell their home and move closer, That's not an option for them, especially in this housing market.
It would be nice if they could buy a hybrid, but they might not have the money, and they're driving that old beater. And it’s getting eight miles a gallon. And that's no joke. We gave everybody a tax cut, but a lot of that money gets eaten up by high gas prices.
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We didn’t understand the degree to which the financial system might melt down and its global consequences. And yet, despite the enormous economic challenges we faced, despite the changes that we’re seeing internationally, we have made extraordinary progress -- not just pulling the economy back from the brink, but also pushing through that vision that we had, making an America that was more competitive, that was more inclusive, an America that was tapping into that entrepreneurial spirit and once again regaining our edge in this 21st-century global economy, and ended up delivering on promises and commitments that we had made to each other that we knew were going to be very hard, but we knew were going to be important for our future.
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But two and a half years later, the economy is growing again. Two and a half years later, we’re creating jobs again. Two and a half years later, the financial system works again. Two and a half years later, small businesses are opening their doors again.
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Over the last four months, we’ve seen the largest drop in unemployment since 1984. Over the last 13 months we have created nearly 2 million private sector jobs. Some of the things that weren’t popular that folks said wouldn’t work have worked. We have a Big Three auto industry in Detroit that is back on its feet, making a profit again. GM announced it’s hiring all its workers back.
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But in the meantime, look, I want all of you to be rich. Now, I don’t mean just going out and buying lottery tickets. I want your small business to be successful. I want you to succeed in your careers. I want everybody to be successful. We don’t want to punish success. But what we do want is a society where if we’re going to ask everybody to sacrifice a little bit, we don’t just tell millionaires and billionaires, oh, you don’t have to do anything. You go ahead and just relax, count your money.
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That makes my life better. That makes my life richer -- knowing that everybody has a measure of dignity and respect, and a shot at the American Dream. I don’t do that for somebody else. I do it because it improves my life and it’s going to improve Malia’s life and Sasha’s life.
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We didn’t even know how steep the climb was going to be to get to where we needed to go, but we understood it was not going to be easy. The campaign wasn’t easy. There’s a lot of revisionist history going on now that, boy, his campaign was so smooth. It didn’t feel that way at the time. I mean, it was hard. But we kept at it because we understood that a country that is generous and compassionate, that is looking after our children and making sure they’ve got a shot at the American Dream, that is making sure our seniors have dignity and security in their old age, that looks after families who’ve got a disabled child, that is investing in our infrastructure so that we can move products and services and people and information around rapidly, that is a benevolent influence around the world and is respected around the world -- we understood that getting to where we needed to go wasn’t going to be easy, and it hasn’t been.
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But we have made extraordinary progress over the last two and a half years. We’ve pulled this economy out of a recession. We’ve stabilized the financial system. We’ve passed historic health care legislation to make sure 30 million people aren’t going to go without coverage. We have repealed “don’t ask, don’t tell.” We have put two women on the Supreme Court, including the first Latina. We’ve passed equal pay for equal work.
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Sometimes I get letters from children who are worried about their parents losing a job. And I get letters from parents describing what it’s like to send 16 resumes out and not get a response. I hear from families who are worried about losing their homes. I worry about small businesses who have put their heart and soul and everything they own into something that was working and now suddenly credit has been pulled back and they're not sure if they're going to make it.
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And most of all, I think what you find are people who are worried about the future of the American Dream. Now, everybody here, almost by definition, has lived out that American Dream. We have been extraordinarily blessed by a country that historically has provided more opportunity to more people than any other in history. Many of us are children of immigrants. Sharon was just describing what it was like for her parents to come here from other countries -- in some cases, fleeing the Holocaust -- and somehow being able to make a life for their families and then ultimately see their children and their grandchildren succeed in ways that they never dreamed before. And that's the story for most of us.
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And I didn't expect that not only I would have the extraordinary honor of taking this highest office, but also doing so at a time when we were facing the worst crisis since the Great Depression. Now, we’ve spent two years cleaning up after a big mess. And not all the decisions that we made were popular. I think most of the decisions we made were right. Because of the actions that we took swiftly upon coming into office, the financial system stabilized, and I think that if you asked anybody back in March of 2009 whether we were going to see almost all of the losses on Wall Street recover, the financial system working again at relatively modest costs to taxpayers, I think most of us would have taken that scenario.
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We have a auto industry that for the first time in a very long time is turning a profit, and has hired back workers instead of laying them off. We have been able to take an economy that was shrinking at about 6 percent per quarter and is now growing. And we’ve added 2 million jobs over the last 13 months in the private sector alone.
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And that’s understandable. We’re not going to have the same kind of campaign entirely that we had in 2008. But the animated spirit behind it, the desire to make sure that that American Dream is available for everybody and that we have -- when we have tough decisions to make, we have shared sacrifice, no single group or person is bearing that burden, and that we’re also making sure that we’ve got shared opportunity and access -- that animating spirit at the core of my campaign, the belief that there’s a lot more that we have in common than what drives us apart, that hasn’t changed. And my enthusiasm for this job and my optimism about America is not diminished.
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We do. She’s just -- she’s just speaking the truth. We still got work to do. When I decided to run -- and some of you were on this journey three years ago, four years ago, when folks couldn’t pronounce my name. What we understood was that even before the recession, folks all across the country were feeling that that American Dream was starting to slip out of their grasp.
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And all across this country, there are people who still believe in that. They’re working so hard every day. They’re looking after their families. They’re looking after their communities. They’re in their churches and synagogues and mosques. They’re volunteering. They’re mentoring. They’re coaching Little League. And yet they’ve been feeling even before the recession hit that maybe this American Dream, this idea of America was starting to slip away.
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Because of you, we made the largest investment in clean energy in our history. And that’s already changing how jobs and businesses across the country are thinking about energy. We’re creating new businesses, advanced battery manufacturing, and plants building wind turbines and solar panels. But at a time when gas prices are --
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I know there are times where some of you felt frustrated, where we haven’t gotten everything done that we wanted to get done. I know you guys. Why did health care take so long? And we didn’t get our public option -- you know, it’s like, you know, what are we doing about this energy thing? It’s not happening fast enough. And, look, small business -- you know.
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And that was all before the worst recession since the Great Depression. By the time I was sworn in, we had already lost 4 million jobs in the previous six months. In the next six months, before our economic policies had a chance to take effect, we lost another 4 million. The financial system was on the brink of collapse. We were about to see the liquidation of the U.S. auto industry.
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And yet because of the work, in part, of people like Chuck and Kirsten and Carolyn and others who worked so hard in Congress, what we were able to do is right the ship. We had to take some unpopular decisions. We had to do some things that people weren’t sure were going to work. But we made those tough decisions. And as a consequence, an economy that was shrinking is now growing. An economy that was shedding jobs over the last 13 months, we’ve created 2 million jobs in the private sector. The stock market is almost fully recovered. The financial system has stabilized. And people have a sense that this recovery may finally start building some steam.
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We imagine a big America where we’re investing in the same kind of science that invented the Internet. We want to invent the next big energy breakthrough that is going to make sure that we’re no longer dependent on foreign oil, and we can start finally doing something about climate change, and we’re not vulnerable to huge spikes in gasoline prices. We want that transformation starting here in the United States of America.
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And preserving this idea -- keeping the American Dream alive from one generation to the next -- that’s never been an easy task. It’s an even greater test in times of rapid change. And all of you are graduating at a moment when change is coming faster than ever before. We’re emerging from an economic downturn like we haven’t seen since the 1930s. Massive shifts in technology have shifted profoundly what our economy looks like. Massive shifts abroad geopolitically have swift and dramatic impacts not only overseas but also here at home, from markets on Wall Street to wallets on Main Street. Just as advances in technology have the power to make our lives better, they also force us to compete with other nations like never before. Tackling big challenges like terrorism and climate change require sustained national effort, and yet too often, our politics seems as broken, as divided as ever.
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Your visit to this country inevitably reminds us of our shared history, our common language, and our strong intellectual and cultural links. It also reminds us that your country twice came to the rescue of the free and democratic world when it was facing military disaster. On each occasion, after the end of those destructive wars, the generosity of the United States made a massive contribution to our economic recovery.
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And obviously the nature and role of the public sector in the United Kingdom is different than it has been in the United States. The pressures that each country are under from world capital markets are different. The nature of the debt and deficits are different. And as a consequence, the sequencing or pace may end up being different.
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And I would argue the proof of that for the UK has been what has happened in capital markets. And as the President just said, capital markets treat different countries differently. Well, in the European context, what you’ve seen since the election is actually market interest rates in the UK, bond yields effectively come down. Whereas you look at what’s happened in Greece or in Portugal or other European countries, you’ve often seen those bond rates increase. That, in my view, is the risk we would have run if we had not set out on the path of deficit reduction.
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Today, after a difficult decade that began with war and ended in recession, our nations have arrived at a pivotal moment once more. A global economy that once stood on the brink of depression is now stable and recovering. After years of conflict, the United States has removed 100,000 troops from Iraq, the United Kingdom has removed its forces, and our combat mission there has ended. In Afghanistan, we’ve broken the Taliban’s momentum and will soon begin a transition to Afghan lead. And nearly 10 years after 9/11, we have disrupted terrorist networks and dealt al Qaeda a huge blow by killing its leader –- Osama bin Laden.
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Together, we have met great challenges. But as we enter this new chapter in our shared history, profound challenges stretch before us. In a world where the prosperity of all nations is now inextricably linked, a new era of cooperation is required to ensure the growth and stability of the global economy. As new threats spread across borders and oceans, we must dismantle terrorist networks and stop the spread of nuclear weapons, confront climate change and combat famine and disease. And as a revolution races through the streets of the Middle East and North Africa, the entire world has a stake in the aspirations of a generation that longs to determine its own destiny.
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A financial crisis that began on Wall Street infected nearly every continent, which is why we must keep working through forums like the G20 to put in place global rules of the road to prevent future excesses and abuse. No country can hide from the dangers of carbon pollution, which is why we must build on what was achieved at Copenhagen and Cancun to leave our children a planet that is safer and cleaner.
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We think that Russian accession to the WTO will be good for the Russian economy, will be good for the U.S. economy, it will be good for the world economy. And we are confident that we can get this done. And it will be a key building block in expanding trade and commerce that create jobs and benefit both countries.
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We look forward to obviously additional discussions with the Russian President in the G8 process around the world economy, world finances, issues like nuclear security. But I just want to emphasize that my interactions with President Medvedev have always been excellent. I think that he is doing fine work in moving Russia forward on a whole range of issues. And I appreciate the excellent cooperation that’s been established between our governments.
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We discussed the enormous opportunities as well as challenges that are presented by the Arab Spring, and shortly we’ll be discussing in depth how we can fully support countries like Egypt and Tunisia, not only as they transition to democracy but also ensuring that that democratic transition is accompanied by economic growth, which can provide more opportunities for all the people, particularly the young people in the region.
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We’re also aiming to expand our bilateral economic relationship with Poland, as the Prime Minister mentioned. Poland’s economy was the only economy in the EU not to fall into recession during the economic crisis, and has enormous potential for economic growth. So far, as a consequence, this fall we will hold a high-level U.S.-Poland business roundtable, which brings together private and public sector leaders to identify and promote new opportunities to boost economic growth. And the idea that was raised by the Prime Minister about a potential innovation fund that is a part of this fall summit I think is an excellent idea, and so we’re going to pursue that actively.
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And so to the American people, even at a time when we have fiscal constraints, even at a time where I spend most of my day thinking about our economy and how to put folks back to work and how to make sure that we’re reducing gas prices and how we stabilize the housing market and how we innovate and adapt and change so that we are fully competitive in the 21st century and maintain our economic leadership, I want the American people to understand we’ve got to leave room for us to continue our tradition of providing leadership when it comes to freedom, democracy, human rights.
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And the fact that Poles today can speak with so much pride about ourselves on the eve of the presidency in the European Union, that we were also able to show to Europe how to manage -- how to operate also under the conditions of the financial crisis, it was possible, amongst others, thanks to the fact that we together have invested in our future with so much of American and Polish enthusiasm.
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In this new role, John will be able to draw on decades of business experience across a range of industries -– from his role on the boards of major companies like Disney and Boeing, to his leadership in the clean energy industry. That’s the expertise that will help us create new jobs and make America more competitive in the global economy.
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So over these past two and a half years, I’ve had some tough calls to make. I had some tough calls as soon as I took office. We had to prevent a financial system from falling apart and dragging the economy into depression. We had to pass reforms to stop abuses in the financial system and prevent future crises. We had to rescue the auto industry. I did not think it was going to be an auto CEO. Even though there were a lot of people who said, let them go, let more than a million jobs vanish, allow two of America’s iconic companies to be liquidated and sold off for parts, we said no, we’re going to have to step up, we’re going to have to deal with it.
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But even as we took these emergency steps, we started tackling all the challenges that we had talked about during the campaign, all the things that were standing in the way of the American Dream. Because that’s why I ran. That’s what the campaign was about. That's why you supported me. Because we believed in an economy that didn’t just work for those at the top, but worked for everybody -– where prosperity was shared. Where prosperity was shared from the machinist on the line to the manager on the floor, to the CEO in the boardroom.
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We worked so hard in 2008 because we believed that we have to define our success not just by stock prices or corporate profits, but whether ordinary folks can find a good work, whether they can afford a middle-class life, whether they can pay the mortgage and take care of their kids and save some money for their child’s college education or their own retirement, and maybe have a little left over to go to a movie or dinner or even a play. Since we're in New York.
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That’s why we cut taxes for middle-class families, and ended subsidies to the banks for student loans to make college more affordable. That’s why I was proud to sign a bill to make sure women earn equal pay for equal work -- a basic principle. That’s why we’re promoting manufacturing and homegrown American energy -– because that’s what will lead to jobs that pay a decent salary. That's why we’re standing up a new consumer bureau with just one responsibility -- looking out for ordinary folks in the financial system so they're not cheated. That's why we passed health reform, so that no one in the richest nation on Earth ever has to go bankrupt because they or somebody in their family get sick. That was the right thing to do.
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So we have spent the last two and a half years cleaning up a big mess. We’ve stabilized the financial system and the markets have recovered a large part of what they had lost, which is important not just for Wall Street, but is important for people across the country and the economy as a whole. Capital is flowing again. Businesses who are large or medium-size are able to access capital and invest it in plants and equipment, and hire new workers. An economy that was shrinking by about 6 percent is now growing. We’ve added, over the last 15 months, over 2 million private sector jobs.
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And I know that most of you I think share the vision that I have, partly because a lot of us in this room have been incredibly lucky but we weren’t necessarily born lucky. There are a lot of folks in this room like me who ended up achieving the American Dream because somebody made an investment in us. Somebody said, you know what, you can have a scholarship to go to the best universities in the world even though your family isn’t well connected. Somebody said, you are going to have the opportunity to practice law in a law firm even though you didn't have any lawyers in your family. Somebody said, you can go ahead and run for the United States Senate even though you've got no connections and nobody can pronounce your name.
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And so I had to make a series of decisions very quickly. And they were big and often tough decisions. We had to make sure that we yanked the economy back from the brink of a Great Depression. We had to make sure that we stabilized the financial system so that we didn’t have a full meltdown, and so that businesses could get financing and keep their doors open and keep their employees and make payroll.
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We had to save an auto industry. I didn't anticipate being a CEO of a couple auto companies. But we had to make sure that we saved those iconic companies from liquidation because a million jobs depended on them. And as a consequence of those decisions, all of which were hard, all of which were controversial, many of which were not popular, we were able to bring the economy back from the brink. And we were able to stabilize the financial system. An economy that was shrinking by 6 percent a year began growing again. An economy that was shedding hundreds of thousands of jobs has now over the last 15 months created more than 2 million jobs in the private sector alone.
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And so the track record of the last two and a half years is one that I could not be prouder of. And we couldn’t have accomplished it -- because of you. We could not have accomplished it without you. But what is also true is we’ve got so much work left to do, because there are still millions of people across the country who are hurting. I hear from them every day. People who send out 16, 30, 50 resumes, and haven’t gotten an answer back and are starting to feeling they will never find a job again. People who have lost their homes. People who have seen their small business and their life savings lost in the crisis.
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I don't believe in a small America or a cramped vision of America that says only a few can do well. I believe in a big America, an expansive and compassionate and generous America, and a bold America and an optimistic America, and one that says it does not matter who you are or what you look like or where you come from, everybody has got a chance at the American Dream.
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And while these changes have resulted in great wealth for some Americans and have drastically increased productivity, they’ve also caused major disruptions for many others. Today, a high school diploma no longer guarantees you a job. Over the past 13 years, about a third of our manufacturing jobs have vanished. And meanwhile, the typical worker’s wages have barely kept up with the rising costs of everything else. And all this was even before a financial crisis and recession that pounded the middle class even more.
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If we want a robust, growing economy, we need a robust, growing manufacturing sector. That’s why we told the auto industry two years ago that if they were willing to adapt, we’d stand by them. Today, they’re profitable, they’re creating jobs, and they’re repaying taxpayers ahead of schedule.
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Throughout our history, our greatest breakthroughs have often come from partnerships just like this one. American innovation has always been sparked by individual scientists and entrepreneurs, often at universities like Carnegie Mellon or Georgia Tech or Berkeley or Stanford. But a lot of companies don’t invest in early ideas because it won’t pay off right away. And that’s where government can step in. That’s how we ended up with some of the world-changing innovations that fueled our growth and prosperity and created countless jobs -- the mobile phone, the Internet, GPS, more than 150 drugs and vaccines over the last 40 years was all because we were able to, in strategic ways, bring people together and make some critical investments.
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Remarks by the President on the Critical Role the Manufacturing Sector Plays in the American Economy
That’s why two years ago, we stood by the auto industry and kept some of our nation’s largest automakers from being sold for parts. And today, for the first time in years, the Big Three automakers are adding jobs and turning a profit and putting steel workers to work. We also told those companies, though, that they’d have to make some changes to compete, so we brought people together and set the first new fuel-mileage standards in more than 30 years. And that means fewer trips to the pump and less harmful pollution. And this plant has something to do with it, because I was just seeing some doors and some hoods made right here -- more lightweight, more efficient, saves on fuel economy. And that means your business is improved as well. Everybody wins.
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I want to spend most of my time tonight taking questions and having a good conversation, so I’m just going to make a few remarks at the top. Obviously we’ve gone through as tough an economic time in this country as we have in my lifetime and in most of our lifetimes. Since the Great Depression, we haven’t seen the combination of a financial crisis and then a recession as severe as the one that we experienced in 2008.
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We ran because we believed our success isn’t just determined by stock prices and corporate profits, but by whether ordinary folks can find a good job that pays for a middle-class life -- where they can pay the mortgage, and take care of their kids, and send their kids to college, and save for retirement, and maybe have a little left over to go to a movie and go to dinner once in a while.
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We ran because for a decade, wages and incomes had flatlined, and costs kept on going up for everybody even though they didn’t have any more income. That was before the economic crisis hit. And obviously once the economic crisis did hit, we had to take a series of emergency steps to save this economy from collapse -- not because we wanted to help banks or make sure that the auto companies’ CEOs were making good bonuses, but we did it because we wanted to make sure that families who needed help could still take out a loan to buy a house or start a new business. We wanted to make sure that the millions of people who depended on the auto industry, that they would still have jobs.
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And so some of those decisions were tough. And you remember, we got criticized a lot. But you take a look at what’s happened. Some folks didn’t want us getting involved in the auto industry -- I didn’t expect to be the CEO of a car company when I ran for President. But as a consequence of what we did, we saved jobs. We saved American manufacturing. We cut taxes for middle-class families. We ended subsidies to the banks for student loans, to make college more affordable. We made sure -- that’s why I signed a bill to make sure there was equal pay for equal work, because I’ve got two daughters and I want to make sure they’re treated just the same as the boys are. That’s why we’re promoting manufacturing and homegrown American energy -- because that’s what will lead to jobs that pay a decent salary. I want the wind turbines and the solar panels and the electric cars to be built right here in America.
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That’s why, with the help of these outstanding members of Congress, we’re standing up a new consumer bureau with just one responsibility: looking out for ordinary people in the financial system so folks aren’t cheated. Whether you’re getting a credit card or getting a mortgage, you need to know that you’re getting a fair deal.
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And I just to want to remind everybody here, this campaign is not about me. It’s about us. It’s about students who are working their way through college, workers heading to factories to build American cars again, small business owners testing new ideas, construction crews laying down roads, families who faced hardship and setbacks but who haven’t stopped believing in this country, and who believe that we can emerge from this challenge stronger than before.
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We’ve always known that we’d have ups and downs on our way back from this recession. And over the past few months, the economy has experienced some tough headwinds -- from natural disasters, to spikes in gas prices, to state and local budget cuts that have cost tens of thousands of cops and firefighters and teachers their jobs. The problems in Greece and in Europe, along with uncertainty over whether the debt limit here in the United States will be raised, have also made businesses hesitant to invest more aggressively.
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Let me give you some examples. Right now, there are over a million construction workers out of work after the housing boom went bust, just as a lot of America needs rebuilding. We connect the two by investing in rebuilding our roads and our bridges and our railways and our infrastructure. And we could put back to work right now some of those construction workers that lost their jobs when the housing market went bust. Right now, we can give our entrepreneurs the chance to let their job-creating ideas move to market faster by streamlining our patent process. That’s pending before Congress right now. That should pass.
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Good afternoon, everybody. It has been almost three years since the financial crisis pulled the economy into a deep recession. And millions of families are still hurting because of it. They’re trying to get by on one income instead of two, on fewer shifts at the plant or at the hospital. They’re cutting expenses, giving up on a family night out so there’s money for groceries. And for a lot of families, things were tough even before the recession.
So we’ve got to get the economy growing faster and make sure that small businesses can hire again, so that an entrepreneur out there can sell a new product, so that the middle class is getting stronger again, and so folks feel confident in their futures and their children’s futures.
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That’s why we can’t let politics stand in the way of doing the right thing in Washington. We can't stand in the way when it comes to doing the right thing on deficits. And that’s why I want to take steps like making sure payroll taxes for middle-class families don’t go back up next year. That’s why it’s so important that we tackle the problems that led us into this recession in the first place.
One of the biggest problems was that the tables were tilted against ordinary people in the financial system. When you get a home loan, it came with pages of fine print. When you got a credit card, it was as if the contract was written in another language. These kinds of things opened the door to unscrupulous practices -- loans with hidden fees and terms that meant your rate could double overnight. It led to people getting mortgages they couldn’t afford, and it put honest businesses at a disadvantage. And it encouraged dangerously risky behavior on Wall Street, which dragged the economy into the mess that we’re still trying to clean up.
That’s why we passed financial reform a year ago. It was a common-sense law that did three things. First, it made taxpayer-funded bailouts illegal, so taxpayers don’t have to foot the bill if a big bank goes under. Second, it said to Wall Street firms, you can’t take the same kind of reckless risks that led to the crisis. And third, it put in place the stronger -- the strongest consumer protections in history.
Now, to make sure that these protections worked -– so ordinary people were dealt with fairly, so they could make informed decisions about their finances –- we didn’t just change the law. We changed the way the government did business. For years, the job of protecting consumers was divided up in a lot of different agencies. So if you had a problem with a mortgage lender, you called one place. If you had a problem with a credit card company, you called somebody else. It meant there were a lot of people who were responsible, but that meant nobody was responsible.
And we changed that. We cut the bureaucracy and put one consumer watchdog in charge, with just one job: looking out for regular people in the financial system. Now, this is an idea that I got from Elizabeth Warren, who I first met years ago. Back then -- this is long before the financial crisis -- Elizabeth was sounding the alarm on predatory lending and the financial pressures on middle-class families. And in the years since, she’s become perhaps the leading voice in our country on behalf of consumers. And let’s face it, she’s done it while facing some very tough opposition and drawing a fair amount of heat. Fortunately, she’s very tough.
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The fact is the financial crisis and the recession were not the result of normal economic cycles or just a run of bad luck. They were abuses and there was a lack of smart regulations. So we’re not just going to shrug our shoulders and hope it doesn’t happen again. We’re not going to go back to the status quo where consumers couldn’t count on getting protections that they deserved. We’re not going to go back to a time when our whole economy was vulnerable to a massive financial crisis. That’s why reform matters. That’s why this bureau matters. I will fight any efforts to repeal or undermine the important changes that we passed. And we are going to stand up this bureau and make sure it is doing the right thing for middle-class families all across the country.
Middle-class families and seniors don’t have teams of lawyers from blue-chip law firms. They can’t afford to hire a lobbyist to look out for their interests. But they deserve to be treated honestly. They deserve a basic measure of protection against abuse. They shouldn’t have to be a corporate lawyer in order to be able to read something they’re signing to take out a mortgage or to get a credit card. They ought to be free to make informed decisions, to buy a home or open a credit card or take out a student loan, and they should have confidence that they’re not being swindled. And that’s what this consumer bureau will achieve.
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I want to extend the tax relief that we put in place back in December for middle-class families, so that you have more money in your paychecks next year. If you’ve got more money in your paychecks next year, you’re more likely to spend it, and that means small businesses and medium-sized businesses and large businesses will have more customers. And they’ll be in a position to hire.
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I want to give more opportunities to all those construction workers out there who lost their jobs when the housing bubble went bust. We can put them to work, giving loans to private companies that want to repair our roads and our bridges and our airports -- rebuilding our infrastructure, putting Americans to work doing the work that needs to be done. We have workers in need of a job and a country that’s in need of rebuilding, and if we put those two things together we can make real progress.
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I want to cut red tape that stops too many inventors and entrepreneurs from turning new ideas into thriving businesses. I want Congress to send me a set of trade deals that would allow our businesses to sell more products in countries in Asia and South America that are stamped with the words, “Made in America.”
So these are some things that we could be doing right now. There are proposals in Congress, as we speak, and Congress needs to act now. But I also believe that over the long term, the strength of our economy is going to depend on how we deal with the accumulated debt and deficits that have built up over the last decade. And that’s what the discussion in Washington is about right now.
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Now, I know it’s hard to keep up with the different plans and the press conferences and the back-and-forth between the parties, but here’s what it all boils down to -- it’s not that complicated. For a decade, we have been spending more money than we take in. Last time the budget was balanced was under a Democratic President, Bill Clinton. And a series of decisions were made -- whether it was cutting taxes, or engaging in two wars, or a prescription drug benefit for seniors -- that weren’t paid for, and then a financial crisis on top of that, Recovery Act to try to pull us out of a Great Depression -- all those things contributed to this accumulated debt.
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Neither party is blameless for the decisions that led to this problem, but both parties have a responsibility to solve it. If we don’t solve it, every American will suffer. Businesses will be less likely to invest and hire in America. Interest rates will rise for people who need money to buy a home or a car, or go to college. We won’t have enough money to invest in things like education and clean energy, or protect important programs like Medicare, because we’ll be paying more and more interest on this national debt and that money just flows overseas instead of being spent here on the things that we need.
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Now, the one thing we can’t do -- cannot do -- is decide that we are not going to pay the bills the previous congresses have already racked up. So that’s what this whole issue of raising the debt ceiling is all about. Basically, there’s some people out there who argue we’re not going to raise the debt ceiling any more. And the problem is, effectively what that’s saying is we’re not going to pay some of our bills. Well, the United States of America does not run out without paying the tab. We pay our bills. We meet our obligations. We have never defaulted on our debt. We’re not going to do it now.
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But even if we raise the debt ceiling, this debate shouldn’t just be about avoiding some kind of crisis, particularly a crisis manufactured in Washington. This is a rare opportunity for both parties to come together and choose a path where we stop putting so much debt on our credit card. We start paying it down a little bit. And that’s what we’ve been trying to do.
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Now, here’s the thing, though -- and this is what the argument is about -- we can’t just close our deficit with spending cuts alone, because if we take that route it means that seniors would have to pay a lot more for Medicare, or students would have to pay a lot more for student loans. It means that laid-off workers might not be able to count on temporary assistance or training to help them get a new job. It means we’d have to make devastating cuts in education and medical research and clean energy research -- just at a time when gas prices are killing people at the pump.
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And if interest rate costs go up for the United States, they're probably going to go up for everybody. So it would be a indirect tax on every single one of you. Your credit card interest rates would go up. Your mortgage interest would go up. Your student loan interest would potentially go up. And, ironically, the costs of servicing our deficit would go up, which means it would actually potentially be worse for our deficit if we had default. It could also plunge us back into the kind of recession that we had back in 2008 and '09. So it is not an option for us to default.
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Beyond that, I also think that over the first two years I was so focused on policy and getting the policy right, that sometimes I forgot part of my job is explaining to the American people why we’re doing this policy and where we’re going. And so I think a lot of people started trying to figure out, well, how do all these pieces fit together. The auto industry has been saved, and that was a good thing. Well, that saved a million jobs, but people weren’t sure how did that relate to our housing strategy, or how did that relate to health care. And so I think that was something that I could have done better.
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Q Hi, my name is Darla Bunting. I’m a third grade literacy teacher in Southeast D.C. And I view gentrification as a Catch 22, because, on one hand, you’re bringing major businesses to underdeveloped areas in different cities, but on the other hand, the very people who live in the neighborhoods, it kind of seems as though they’re not reaping the benefits. And I wanted to know how can we create sustainable neighborhoods that allow people who are still trying to achieve the American Dream to be able to afford and live in these brand new neighborhoods and communities?
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So what I’ve tried to emphasize in this balanced package that we’ve talked about is how do we make a serious down payment and commitment to deficit reduction but, as much as possible, focus on those structural long-term costs that gradually start coming down, as opposed to trying to lop off everything in the first year or two, and how do we make sure that as part of this package we include some things that would be good for economic growth right now.
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We've had a very good and tremendous reception the last couple of days. I want to thank you for that, personally. We're excited about the opportunities of the Trans-Pacific Partnership. We're excited about the chance to put together a regional trade deal which includes the United States and which will expand over time beyond the nine countries -- and I think it can deliver strengthened and continued economic growth, jobs and higher incomes and better opportunities.
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You’ve got just a huge number of people who, in one way or another, interact with the federal government. And even if you don’t, even if you’re not a recipient of Social Security, even if you don’t get veterans’ benefits or disabilities, imagine what that does to the economy when suddenly 70 million checks are put at risk. I mean, if you’re a business out there, that is not going to be good for economic growth. And that’s the number one concern of the American people.
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My number-one priority, every single day, is to figure out how we can get businesses to hire and create jobs with decent wages. And in the short-term, there are some things we can do right away. I want to extend tax relief that we already put in place for middle-class families, to make sure that folks have more money in their paychecks. And I want to cut red tape that keeps entrepreneurs from turning new ideas into thriving businesses. I want to sign trade deals so our businesses can sell more goods made in America to the rest of the world, especially to the Americas.
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We’re keeping our promise to make sure that America remains a place where opportunity is open to all who work for it. We’ve cut taxes for middle-class workers and small businesses and low-income families. We won credit card reform and financial reform, and protections for consumers and folks who use payday lenders or send remittances home from being exploited and being ripped off.
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We worked to secure health care for 4 million children, including the children of legal immigrants. And we are implementing health reform for all who've been abused by insurance companies, and all who fear about going broke if they get sick. And these were huge victories for the Latino community that suffers from lack of health insurance more than any other group.
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So there are plenty of ways out of this mess. But we are almost out of time. We need to reach a compromise by Tuesday so that our country will have the ability to pay its bills on time, as we always have -- bills that include monthly Social Security checks, veterans’ benefits and the government contracts we’ve signed with thousands of businesses. Keep in mind, if we don’t do that, if we don’t come to an agreement, we could lose our country’s AAA credit rating, not because we didn’t have the capacity to pay our bills -- we do -- but because we didn’t have a AAA political system to match our AAA credit rating.
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With respect to economic development, all of us agree that we can’t keep on duplicating a approach that breeds dependence, but rather we need to embrace an approach that creates sustainability and capacity within each of these countries, through trade and investment and the development of human capital and the education of young people throughout these countries.
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Now, for the last few months, gas prices have just been killing folks at the pump. People are filling up their tank, and they're watching the cost rise -- $50, $60, $70. For some families, it means driving less. But a lot of folks don’t have that luxury. They’ve got to go to work. They’ve got to pick up the kids. They’ve got to make deliveries. So it’s just another added expense when money is already tight.
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And of course, this is not a new problem. For decades, we’ve left our economy vulnerable to increases in the price of oil. And with the demand for oil going up in countries like China and India, the problem is only getting worse. The demand for oil is inexorably rising far faster than supply. And that means prices will keep going up unless we do something about our own dependence on oil. That’s the reality.
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Well, this is an outstanding crowd, and I don’t want to stand in the way of a lot of good work that’s going to be done, so I’m going to just make some brief remarks at the top. We’ve got small business owners here. We have farmers. We have ranchers, public servants, clean energy entrepreneurs and community organizations from all across rural America. And I’m here because I want to hear from you, and my Cabinet wants to hear from you.
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There are two things that I know for sure: America is going to come back from this recession stronger than before. That I’m convinced of. I believe that. And I’m also convinced that comeback isn’t going to be driven by Washington. It’s going to be -- it is going to be driven by folks here in Iowa. It’s going to begin in the classrooms of community colleges like this one. It’s going to start on the ranchlands and farms of the Midwest, in the workshops of basement inventors, in the storefronts of small business owners.
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The question is if we’re going to harness the potential to create jobs and opportunities that exist here in Iowa and all across America. We know what’s possible if we’re willing to fight for our future and to put aside the politics of the short term and try to get something done. Already this administration has helped nearly 10,000 rural businesses and 35,000 small and medium-sized farms and ranches to get the financing that they need -- that’s already happened. And that means a restaurant owner can bust down a wall and set up some more tables. It means a family farm can buy a new piece of equipment to get more product to market. And that puts people to work today.
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So today, I’m announcing that we’re ramping up our efforts to get capital to small businesses in rural areas. We’re doubling the commitment we’ve already made through key small business lending programs. We’re going to make it easier for people in rural areas looking for work to find out about companies that are hiring. We're going to do more to speed the development of next-generation biofuels, and we’re going to promote renewable energy and conservation. We’re going to help smaller local hospitals in communities like this one to recruit doctors and the nurses that they need. And those are just some of the things that we’re already announcing today. The reason we brought you all together is because I’m looking forward to hearing from you about what else we can do to jumpstart the economy here in rural America.
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So what I said to them is the same thing that I say to the entire group: We genuinely believe that small business is the backbone of America. It’s going to be the key for us to be able to put a lot of folks back to work. What we’re looking for is, how can we do our jobs better? How can the SBA or USDA or any of the other federal agencies that touch on rural America on a regular basis help you create the jobs and businesses and ideas that I think are so evident in a lot of communities all across the country.
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I met with a group of small business owners, including a woman named Jan Heister, who started a small tooling and manufacturing company around twenty years ago. Started off with nine people in a very small plant, and with the help of an SBA loan, she’s got a staff of more than 140 in a 160,000-square-foot factory. Jan’s not messing around.
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And so it’s a very practical way of thinking about these problems. It’s not either/or. It’s a recognition that the prime driver of economic growth and jobs is going to be our people and the private sector and our businesses. But you know what, government can help. Government can make a difference.
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We were on the verge of going into a Great Depression, and we were able to yank ourselves out. The economy is now growing again. Over the last 17 months we’ve created over 2 million jobs in the private sector. We saved an auto industry that was on the brink. We have -- we’ve made investments in clean energy, in rebuilding our roads and our bridges.
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Now, the fact is, though, times are still tough. And some of the reasons times are still tough we don’t have complete control over. The economy was predicted to be growing at about 3.5 percent at the beginning of this year, partly because we had worked a bipartisan package of tax cuts and investment credits to encourage businesses to invest. But then you had the Arab Spring, and that shot gas prices and fuel prices up. And I know a lot of farmers here experienced that spike. And then we had the tsunami in Japan, and that disrupted supply lines and that affected American manufacturing. And then we had the situation in Europe and the debt crisis there, and that started lapping up onto our shores.
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There’s no reason why, as Ray LaHood knows, we’ve got over $2 trillion worth of repairs that need to be made around the country, and I know there are some right here in this county and right here in this state. And we’ve got a lot of construction workers that are out of work when the housing bubble went bust, and interest rates are low, and contractors are ready to come in on time, under budget -- this is a great time for us to rebuild our roads and our bridges, and locks in the Mississippi, and our seaports and our airports. We could be doing that right now, if Congress was willing to act.
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And when the economy was really in the drink in 2009 and 2010, there was basically no inflation -- prices were actually going down. That’s why seniors did not get the cost-of-living adjustment. That doesn’t mean that they weren’t still having a hard time because food prices or gas prices or what have you might have been going up, or the cost of medicine. So as a consequence, we actually proposed -- and I’m sure Danny was one of the co-sponsors of this -- legislation that would have given an extra $250 to seniors just to help make ends meet. We couldn’t get Republican support for it. But seniors who are still upset about not getting your COLA -- or if they’re not here, but when you go back and you’re talking to your grandma and they’re still mad at me about it, I just want you guys to set the record straight, okay?
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So don’t buy into this notion that somehow all our problems would be solved if we eliminate government. Part of the reason we had this financial crisis was because we didn’t have government doing a good enough job looking over the shoulders of the banks to make sure that they weren’t taking crazy risks.
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And interest rates are low, so we could finance right now the rebuilding of infrastructure all across America that drove not only unemployment in the construction industry down, but drove unemployment down across the board. And traditionally that hasn’t been a Democratic or a Republic issue. That’s been an American issue. We’ve taken pride in rebuilding America.
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And some of those things are not in our control. We couldn’t control the tsunami in Japan that disrupted supply chains. We could not control what happened in the Middle East that drove up gas prices. We don’t have complete control over what happens in Europe with their problems. And all those things have affected our economy, but there are so many things that we’ve got control over right now that we could be doing to put people back to work.
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Since the debt ceiling fiasco in Washington, the phones have stopped. We have no consumer confidence after what has just happened. Interest rates are a record low. I should be out working 14 hours a day, and I am not. What are your future plans in helping middle-class America -- Generation X and Y and middle-class America will get the country out of where we are, and I want to know what are your contingent plans?
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Well, what we’ve been trying to do is make sure that -- we’ve probably had a couple of million loan modifications that have been taking place. The problem is, is that the housing market is so big. And so a lot of families have just had to work down their debts, and they’ve been successful -- and as you said, we were starting to see things bottom out and confidence start picking up.
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There are some other ideas that we’re looking at on the housing front. But I’ll be honest with you, when you’ve got many trillions of dollars’ worth of housing stock out there, the federal government is not going to be able to do this all by itself. It’s going to require consumers and banks and the private sector working alongside government to make sure that we can actually get the housing moving back again. And it will probably take this year and next year for us to see a slow appreciation again in the housing market.
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Well, there are some things that we can do without Congress, and we’re trying to do them. So, for example, I set up a jobs council made up of a lot of employers, both small businesses but also some of the biggest companies in the world, and asked them what can we be doing to encourage job growth. And they’ve come up with a series of recommendations, some of which don’t involve Congress at all, and we’re trying to implement them.
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And when it comes to upper-income folks -- I talked about Warren Buffett -- but the truth is -- I’ll just give you one example. The reason Warren Buffett’s taxes are so low is because he typically gets his income from capital gains. Capital gains are taxed at 15 percent. Now, your income taxes, you’re not being taxed at 15 percent, most of you. And as a consequence, these days the richer you are the lower your tax rate. Now, that can’t be something that is defensible regardless of party. I don’t care whether you’re a Democrat or Republican, an independent. That can’t be the way it is.
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Well, let me talk to you about Social Security. It is very likely that she will see a COLA, a cost-of-living increase next year, because inflation actually rose this year. The reason that there were a couple of years where she did not get a cost-of-living increase was because even though she probably felt like the cost of food and gas and groceries were going up, the overall inflation index actually did not go up. There was a period there where we actually had what’s called deflation, where the costs were a little bit lower than they had been comparable to the previous year.
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Q Some of those programs are dependent upon the unemployment rate. My question is, with the unemployment rate, you’re only counting the people who are actually on unemployment. It’s not counting the people who worked a temporary job that was not eligible for unemployment or the people who were on unemployment and now that unemployment has ran out. So those people are not being counted.
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We had reversed the recession, avoided a depression, got the economy moving again, created 2 million private sector jobs over the last 17 months. But over the last six months, we've had a run of bad luck.
Alan brings a wealth of experience to the job. He’s one of the nation’s leading economists. For more than two decades, he’s studied and developed economic policy, both inside and outside of government. In the first two years of this administration, as we were dealing with the effects of a complex and fast-moving financial crisis -- a crisis that threatened a second Great Depression -- Alan’s counsel as chief economist at the Treasury Department proved invaluable.
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So it’s that spirit that I’m going to be calling upon in the coming days. Next week, I will be laying out a series of steps that Congress can take immediately to put more money in the pockets of working families and middle-class families, to make it easier for small businesses to hire people, to put construction crews to work rebuilding our nation’s roads and railways and airports, and all the other measures that can help to grow this economy.
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And across the nation, we’re still digging out from the worst economic crisis since the Great Depression. It’s taking longer and it's been more difficult than any of us had imagined. And even though we’ve taken some steps in the right direction, we've got a lot more to do. Our economy has to grow faster. We have to create more jobs, and we have to do it faster. And most of all, we've got to break the gridlock in Washington that’s been preventing us from taking the action we need to get this country moving. That’s why, next week, I’ll be speaking to the nation about a plan to create jobs and reduce our deficit -– a plan that I want to see passed by Congress. We've got to get this done.
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Companies like Hilltop, construction companies, have been hit harder by this economic crisis than almost any other industry in America. And there are millions of construction workers who are still out there looking for a job. They're ready to work, but things have been a little tough. That doesn’t mean that there is not plenty of construction waiting to get done in this country.
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The American Jobs Act will cut taxes for the typical working family by $1,500 next year. It will cut taxes for every small business in America. It will give an extra tax cut to every small business owner who either hires more workers or raises those workers’ wages. How many people here would like a raise?
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And we know that most small businesses are the creators of new jobs. We’ve got a lot of folks in Congress who love to say how they’re behind America’s job creators. Well, if that’s the case, then you should be passing this bill, because that’s what this bill is all about, is helping small businesses all across America.
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We’re in the midst of an ongoing enormous economic challenge. And I spend a lot of my time thinking immediately about how we can put folks back to work and how we can stabilize the world financial markets. And those things are all important. But the economic challenges we face now are economic challenges that have been building for decades now, and the most important thing we can do is to make sure that our kids are prepared for this new economy. That’s the single-most important thing we can do. So even as we focus on the near term and what we’ve got to do to put folks back to work, we’ve got to be thinking a little bit ahead and start making the tough decisions now to make sure that our schools are working the way they need to work.
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So this isn’t just the right thing to do for our kids -– it’s the right thing to do for our country. We can’t afford to wait for an education system that is not doing everything it needs to do for our kids. We can’t let another generation of young people fall behind because we didn’t have the courage to recognize what doesn’t work, admit it, and replace it with something that does. We’ve got to act now. We’ve got to act now and harness all the good ideas coming out of our states, out of our schools. We can't be tied up with ideology. We can't be worrying about partisanship. We just have to make sure that we figure out what works, and we hold ourselves to those high standards. Because now is the time to give our children the skills that they need to compete in this global economy.
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And against all sorts of setbacks, when the opposition fought us with everything they had, we finally made clear that in the United States of America nobody should go broke because they get sick. We are better than that. And today, insurance companies can no longer drop or deny your coverage for no good reason. In just a year and a half, about one million more young adults have health insurance because of this law. One million young people. That is an incredible achievement, and we did it with your help, with the CBC’s help.
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We're only here because past generations struggled and sacrificed for this incredible, exceptional idea that it does not matter where you come from, it does not matter where you’re born, doesn’t matter what you look like -- if you’re willing to put in an effort, you should get a shot. You should get a shot at the American Dream.
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Domestically, we still have a lot more to do to heal this economy and to deal with some of the structural problems that existed even before the financial crisis hit. We still don’t have an energy policy in this country that will free ourselves from dependence on foreign oil, and can also generate new jobs in a new clean energy space.
We still don’t have the kinds of trade strategies that will open ourselves up to new markets, but make sure that we’ve got trade that’s fair, between ourselves and particularly the growing markets in the Pacific and the Asia region. We still have enormous challenges because middle-class families have not seen their wages and their incomes rise for the last 20 years, even as those of us at the very top have seen an extraordinary explosion in our wealth and our incomes.
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Many of you, many of our parents, our grandparents, we grew up with faith in an America where, if you work hard, if you're responsible, then it pays off. If you stepped up and you did your job and were loyal to your company, that loyalty would be rewarded with a decent salary and decent benefits and a raise once in a while and some security. And you had some belief that the American Dream could be yours, and that your kids could dream even bigger.
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So in 2007, all of this culminated in a once-in-a-lifetime economic crisis -- a crisis that's been much worse and much longer than your average recession. You know, historians have looked, and typically a recession that comes about because of a financial crisis is much deeper and much longer. It takes a long time to work its way through. And so, from the time I took office, we knew, because this crisis had been building for years, it was going to take us years to get back to where we wanted to be.
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Think about it. When we wanted to save the auto industry from not just bankruptcy, but liquidation, there were a whole bunch of folks on the other side who fought us tooth and nail. And that was not easy. They said it was going to be a waste of time and a waste of money. You know what? We did it anyway. And we saved thousands of American jobs as a consequence, and we made sure that America is still making cars that we're selling around the world.
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Instead of giving more tax breaks to the largest corporations, we cut taxes for small business and for middle-class families. The first law I signed into -- the first bill I signed into law made sure that women earn equal pay for an equal day's work, because I want our daughters to have the same opportunities as our sons.
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Over the last two and a half years, even as we’ve been grappling with this economy, even as we’ve been saving the auto industry and making sure that we’ve got an energy policy that makes sense, we've still have been trying to make sure that we’re also dealing with some of the long-term problems that have been building up for decades. And we’ve got more work to do. We’re not yet finished.
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And so this American Jobs Act says, at a time when we have to rebuild our infrastructure to be competitive in the 21st century and we’ve got all these construction workers who are out of work, let’s put them to work rebuilding our roads and our bridges and our schools, and laying our broadband lines, and making sure that -- (applause.) Let’s put teachers back in the classroom at a time when we know that nothing is more important for lasting employment than an education. Let’s give businesses more incentives to hire our veterans and long-term unemployed. And let’s keep taxes low for small businesses, and let’s make sure that taxes don’t go up for middle-class families at a time when they’re still very strained and very stressed.
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And that’s one of the challenges that a lot of folks are seeing out there. You’ve got skilled people with experience in an industry. That industry changes, and you were fortunate enough to be able to move. Some folks, because of the decline in the housing industry, are having trouble with mobility in finding new jobs and relocating in pursuit of opportunity.
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There’s been a lot of dispute about the kind of impact that we had right after the financial crisis hit. But the fact is, the vast majority of economists who looked at it have said that the Recovery Act, by starting infrastructure projects around the country, by making sure that states had help on their budgets so they didn’t have to lay off teachers and firefighters and others, by providing tax cuts to small businesses -- and by the way, we’ve cut taxes about 16 times since I’ve been in office for small businesses to give them more capital to work with and more incentives to hire -- all those things made a big difference.
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The American Jobs Act is specifically tailored to putting more of those folks back to work. It’s not going to solve all our problems. We’ve still got a housing situation in which too many homes are underwater. And one of the things that we’ve proposed as part of the American Jobs Act is, is that we’re going to help reduce the barriers to refinancing so that folks can get record-low rates. That will put more money into people’s pockets. It will provide tax cuts to not only small businesses, but almost every middle-class family. That means they’ve got more money in their pockets, and that means that they’re going to be able to spend it on products and services, which provide additional incentives for business to hire folks like you.
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Well, it’s hard to say exactly what regulations or taxes she may be referring to, because obviously it differs in different businesses. But as I said, we’ve actually cut taxes for small business 16 times since I’ve been in office. So taxes for small businesses are lower now than they were when I came into office.
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Look, we’re going through a very tough time. But the one thing I want to remind everybody is that we’ve gone through tougher times before. And the trajectory, the trend of not just this country but also the world economy is one that’s more open, one that’s more linked, one that offers greater opportunity, but also one that has some hazards. If we don’t prepare our people with the skills that they need to compete, we’re going to have problems. If we don’t make sure that we continue to have the best infrastructure in the world, we’re going to have problems. If we’re not continuing to invest in basic research, we’re going to have challenges. If we don’t get our fiscal house in order in a way that is fair and equitable so that everybody feels like they have responsibilities to not only themselves and their family but also the country that’s given them so much opportunity, we’re going to have problems.
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Every idea that we have in this jobs bill has, in the past, been supported by Democrats and Republicans. Rebuilding our roads and our bridges and our airports and our schools -- that's not a partisan idea, that's part of what made America an economic superpower. We’ve got all kinds of workers out there who are unemployed because of the housing bubble burst. We could put them to work right now rebuilding America. It will be good for the economy now, but it will also be good for our economic future.
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We need to put teachers back in the classroom. We have -- even in the midst of this economic crisis, we've actually created 2 million jobs over the last couple of years. The problem is we've also lost half a million jobs, mostly in state and local government, and a huge proportion of those are teachers that should be in our classrooms right now. We've got to change that, and the jobs bill would put people back in the classroom where they belong.
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This jobs bill provides a tax cut not only to every working family in America, which will put more money in their pockets and allows them to make sure that they can buy all the great products that are created here in Silicon Valley -- but it also cuts taxes for small businesses and entrepreneurs. It cuts taxes for companies that are hiring new workers or who are providing their workers raises. And it provides a tax credit for those who are hiring veterans.
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I need you to be out there making arguments that the notion the only way we succeed in international competition is by stripping away laws against polluting our planet. That’s a short-sided approach to economic development and it’s not going to work. We’re never going to be able to compete on having the dirtiest air or the cheapest labor. We’ll never compete that way.
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We've gone through an unprecedented time in our history. We have not seen anything like this in our lifetimes -- a financial crisis that is as bad as anything since the Great Depression, followed by a recession that is deep and lasting and has hurt a lot of people. And my first job when I came to office was to make sure that we didn’t tip into a depression, to save the auto industry, to make sure that we stabilized a financial system that was teetering on the brink of meltdown.
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So there’s a vision out there to be had, and we’re going to have to drive towards it. Now, short term, what we need to do is just put people back to work. And that’s why a couple of weeks ago, I said, pass this jobs bill now. We can put people to work rebuilding America, rebuilding our schools and our roads and our bridges. Construction workers are out of work. Contractors are begging for work -- they’re able to come on and finish a project on time and under budget. The interest rates are low. Now is the time to do it.
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Let’s pass this jobs bill and put teachers back in the classroom where they belong. Places like South Korea, they’re adding teachers in droves to prepare their kids for the global economy. We’re laying off our teachers left and right. All across the country, budget cuts are forcing superintendents to make choices they don’t want to make.
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Congress needs to pass this bill so we can help the people who create most of the new jobs in this country -- America’s small business owners. It’s all terrific that corporate profits have come roaring back, but small companies haven’t come roaring back. Let’s give them a boost. Pass this bill, and every small business owner in America gets a tax cut. If they hire new employees, or they raise their employees’ salaries, they get another tax cut.
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So let me summarize here. The American Jobs Act will lead to new jobs for construction workers, jobs for teachers, jobs for veterans, jobs for young people, jobs for the unemployed. It will provide tax relief for every worker and small business in America. And by the way, it will not add to the deficit. It will be paid for.
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If you want construction workers on the job, pass the bill. If you want teachers back in the classroom, pass the bill. If you want a tax cut for small business owners, pass the bill. If you want to help our veterans share in the opportunity that they defended, pass the bill.
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And, by the way, we have not been getting any help from the other side. When we wanted to save the U.S. auto industry from collapse -- a million jobs might have been lost, iconic companies gone, our manufacturing base eroded -- you had a whole bunch of other folks who said that it was going to be a waste of time and a waste of money.
Well, you know what we did? We did it anyway. We fixed it anyway and we saved those jobs. And we made sure taxpayers got their money back. And today, the American auto industry is stronger than ever, and turning a profit, and they’re making fuel-efficient cars that can help save our environment. That’s a fight that is worth -- that is a fight that is worth it.
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When we wanted to pass Wall Street reform to make sure that we didn’t go through the same kind of crisis that we went through in 2007, 2008, and make sure that consumers finally get some protection so you’re not cheated when you apply for a mortgage, and you’re not having hidden fees in your credit cards, the lobbyists and the special interests, they rounded up millions of dollars to fight us. But you know what? We did it anyway, because it was the right thing to do. And today you don’t have to suffer from hidden fees and unfair rate hikes, because we knew that we were on the right side of that fight.
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The American Jobs Act cuts taxes for virtually every worker in America. It cuts taxes for small businesses all across America. It gives an extra tax credit if small businesses hire a new worker or give a worker a raise. Congress and the Republicans are always talking about how much they love job creators. Do something for job creators. Pass this bill and give them the tax breaks that will help them grow their business and hire more workers.
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So we’ve got a different vision about how we go forward, and it’s a vision that’s grounded in the history and the story of America. Yes, we’re rugged individualists. Yes, we are self-reliant. We’re not looking for a handout. We know we’ve got to work hard. We know we’ve got to instill in our kids a sense of responsibility and hard work and achievement. That’s how the American Dream is built. But we also know that we’ve always been a nation that looks out for one another -- a belief that we’re all connected, that there are some things we can only do as a nation. That is not a Democratic or a Republican idea. It’s the idea of Abraham Lincoln when he built the interstate -- or the Intercontinental Railroad. It was the idea of Dwight Eisenhower when he helped to build the Interstate Highway System. When those two Republican Presidents invested in land grant colleges or the space program -- there are some things we can’t do on our own. There are some things we do together.
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MS. MEDINA: So my first question: , your proposed jobs bill addresses tax breaks for small businesses and the repair of infrastructure like roads and bridges. But that seems like a short-term solution to a much larger problem. With the unemployment rate among Latinos at 11.3 percent across the nation, what do you plan to do for the remainder of your term, and if reelected, to ensure that large factories and Fortune 1000 companies begin hiring again?
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What the jobs act does is a couple of things. Number one, it, yes, puts people back to work rebuilding roads, bridges, schools. Those infrastructure projects could employ a lot of construction workers -- including a lot of Latino construction workers -- who were laid off after the housing bubble burst. And so that could significantly reduce unemployment in that sector.
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This is a long-term challenge. The Mexican economy is very integrated to the world economy and the U.S. economy, so they were affected by the recession very badly themselves. I have a great relationship with President Calderón and we have looked for a whole range of ways that we can improve cross-border trade. For example, we've been focused on how we can change the borders infrastructure so that goods are flowing more easily back and forth.
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This is a question that I always get from Social Security recipients as well. The way Social Security is set up is each year there's a cost-of-living adjustment. But over the last two years, because of the recession, inflation didn’t really exist in the aggregate. So even though one particular good or gas prices might have gone up a little bit, when you looked at the basket of goods there wasn’t a lot of inflation over the last two years. That's why the cost-of-living adjustment did not kick in.
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Extraordinarily proud of the accomplishments and the progress that we've made over the last two years. But what we haven’t done is change Washington. And we still have work to do to make sure that this town is working on behalf of ordinary folks so that they can start once again believing in the American Dream -- because people have lost confidence in the capacity of folks to look out for them as opposed to look out for themselves or their most powerful patrons. And that’s part of what 2012 is all about.
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So let me just close by saying this. I could not be prouder to have friends and supporters like the people in this room. I hope you are signed up for a year of hard work. This is not going to be easy. But if we have that same sense of urgency -- what I called in 2008 the “fierce urgency of now” -- if we still possess that, then not only are we going to be able to succeed in the election, but more importantly, we’re going to be able to give the American Dream back to the American people.
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We discussed the world economy, and we shared our intentions to work closely with our European partners to stabilize the eurozone area, but also to make sure that we are all participating in creating a system in which free trade, in which coordinated commercial practices, in which our focus on growing the economy, issues like energy security all involve close coordination between our two countries. And we very much appreciate the partnership there.
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And now more than ever, it’s critical that we make the investments necessary to keep it that way. We live in a global economy where companies and factories can be located anywhere there’s an Internet connection. And to compete in that economy, we can’t cut corners by paying workers less or building cheaper products. We won’t be able to engage in a race to the bottom -- that's not who we are.
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In recent weeks, we decided to stop waiting for Congress to fix No Child Left Behind, and decided to give states the flexibility they need to help our children meet higher standards. We took steps on our own to reduce the time it takes for small businesses to get paid when they have a contract with the federal government. And without any help from Congress, we eliminated outdated regulations that will save hospitals and patients billions of dollars.
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Now, today what I want to focus on is housing, which is something obviously on the minds of a lot of folks here in Nevada. Probably the single greatest cause of the financial crisis and this brutal recession has been the housing bubble that burst four years ago. Since then, average home prices have fallen by nearly 17 percent. Nationwide, more than 10 million homeowners are underwater. That means that they owe more on their homes than those houses are worth. And here in Las Vegas, the city that’s been hit hardest of all, almost the entire housing market is under severe stress.
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So that's going to soon change. Last month, I directed my economic team to work with the Federal Housing Finance Agency -- or FHFA -- and their partners in the housing industry to identify barriers to refinancing, knock those barriers down, and explore every option available to help many American homeowners to refinance.
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Now, let me just say this in closing. These steps that I’ve highlighted today, they're not going to solve all the problems in the housing market here in Nevada or across the country. Given the magnitude of the housing bubble and the huge inventory of unsold homes in places like Nevada, it's going to take time to solve these challenges. We still need Congress to pass the jobs bill. We still need them to move forward on Project Rebuild so we can have more homes like this, and wonderful families having an opportunity to live out the American Dream.
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But even if we do all those things, the housing market is not going to be fully healed until the unemployment rate comes down and the inventory of homes on the market also comes down. But that's no excuse for inaction. That's no excuse for just saying “no” to Americans who need help right now. It's no excuse for all the games and the gridlock that we’ve been seeing in Washington.
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So those are the proposals contained in this bill. It's a bill that's fully paid for -- by asking those of us who make more than $1 million to pay a little more in taxes. Independent economists, people who look at this stuff for a living, say that it's the only plan out there right now that would create jobs in the short term as well as lay a foundation for economic growth in the long term. One economist said it would create nearly 2 million jobs next year -- 2 million. And by the way, that economist did not work for me. And polls show that an overwhelming majority of Americans support the proposals that are in this bill -- Democrats, independents and Republicans.
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We cut taxes for our wealthiest citizens. We didn't enforce worker safety rules. We didn't enforce anti-pollution standards. We didn't enforce regulations on Wall Street. And where did we end up? We ended up with a decade in which income and wages for middle-class families flat-lined, and people tried to make up for it by propping up a housing bubble. And when it went bust we had the worst financial crisis and the worst economic crisis since the Great Depression. That’s the end of the road if you travel that path.
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We still have to implement health care reform. We still have to implement financial regulatory reform. We have set up a consumer watchdog that is going to make sure no more hidden fees, no more abusive mortgage practices that had such a devastating effect here in Nevada. But we’ve got to make sure that it’s actually implemented. And the other side, one of their main agendas is to roll it back.
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I just came from Las Vegas and then Los Angeles and San Francisco, but I want to talk about what was going on in Las Vegas. We were in Las Vegas to announce a new approach to housing refinancing. Some of you may have read about it. That's ground zero in terms of what's happening in housing all across the country. And about 50 percent of the homes in Nevada are underwater. Foreclosure rates are sky high. And there are entire subdivisions that are just being emptied out and foreclosed. And we had a chance to make this announcement in front of the home of Jose and Lissette Bonilla.
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And he said to me, you know, I’m not finished yet. This is part of the American Dream, but I’m not going to be finished with the American Dream until I know that my kids have gotten through college, and they have a home of their own and they’re able to provide a better life for their children the same way that I’ve been able to provide a better life for mine. And I can’t thank America enough for giving me these opportunities.
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And that idea of America is what has inspired the world. And for about a decade, that’s what people felt had been slipping away -- even before this financial crisis, even before the recession -- that sense that the stack was increasingly -- the deck was increasingly stacked against them and that that same progression -- where each successive generation is doing better and the middle class is growing stronger, and if you do your part you can succeed -- people have begun to doubt that. And, obviously, the financial crisis and the great recession that we’ve gone through has made it even worse.
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And on student loans and school reform and on a whole host of issues that don’t get a lot of attention -- on doubling fuel efficiency standards on cars and trucks to not only free ourselves from dependence on foreign oil, but also to start reducing carbon in the atmosphere and making us more competitive, to saving the auto industry -- I keep a checklist in my desk of stuff that I promised to do and we're through about 60 percent of it -- which isn’t bad for three years.
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But in addition to making sure that we didn’t go into a Great Depression and stabilizing the financial system and reversing a contracting economy to one that was growing so that over the last two years we’ve seen private sector job growth just about every month, and 2 million jobs created just over the last two years -- in addition to all that, what we’ve also been able to do is still make progress on the things that we talked about making progress on.
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And sometimes I think people forget how much has gotten done -- whether it’s passing health care for 30 million Americans who didn’t have it, and making sure that young people are able to stay on their parents’ health insurance and insurance companies aren’t dropping you when you’ve got coverage, to making sure that we were ending “don’t ask, don’t tell” so that anybody could serve this country that they love regardless of who they love, to ending the war in Iraq, to making sure that college loans and scholarships were accessible to young people all across the country, to saving the auto industry.
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Before I came to Los Angeles today, I was in Las Vegas. And I think as many of you know, Las Vegas has been hit as hard as any part of the country as a consequence of a housing bubble that burst. Unemployment is higher than it is any place in the country. There are more homes that are underwater than just about any place in the country.
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That’s what America is. That’s why all around the world even today people still think about this country differently than they think about other countries, no matter how critical they may be sometimes, no matter how frustrated they may be. The American ideal, the American creed is one that animates the entire world. And I ran for President because I want to make sure that this country remains that beacon and remains that ideal. And that the hopes of the Joses and the Lissettes, people all across the country, regardless of their station, regardless of what they look like, regardless of where they come from, that they’re going to be able to have that piece of the American Dream.
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But despite that, we brought about change. Despite that, we got health care passed, and 30 million Americans are going to have health care in this country. And a million young people already have health care now that didn’t have it before. Despite the resistance we were able to not only prevent this country from going into a Great Depression, and stabilized the financial system, but were also able to pass financial reform so that we never have the same kinds of irresponsibility on Wall Street again. And we have consumers protected, and people, including in places right here in this city, are protected from unscrupulous mortgage brokers and from credit card companies that are charging hidden fees and taking advantage of families.
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Giving tax breaks to small businesses so they can excel and hire more people. Giving them tax breaks for hiring our veterans. We ask these incredible men and women in uniform to put the pause button on their careers, to leave their families, to put themselves at risk. They shouldn’t have to fight for a job when they come home. We should be doing everything we can to put them back to work, right now. And yet 100 percent of Republican senators so far have said no. Maybe it’s just because I proposed it. Because the American people support it. It’s paid for. Economists say it would create almost 2 million jobs.
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Here in Colorado, you’ve got folks who are spending months -- some, years -- looking for work. We've got families who are making tough sacrifices just to pay the bills, or the mortgage, or college tuition. And Americans know we need to do something about it. And I know this is especially hard for a lot of young people.
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And so the truth is the economic problems we face today didn’t happen overnight, and they won’t be solved overnight. The challenges we face on the environment, or on getting comprehensive immigration reform done -- on all these issues we are going to keep on pushing. And it’s going to take time to restore a sense of security for middle-class Americans. It's going to take time to rebuild an economy that works for everybody -- not just those at the top. But there are steps we can take right now to put Americans back to work and give our economy a boost. I know it. You know it. The American people know it.
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Now, I mentioned that we live in a global economy, where businesses can set up shop anywhere where there's an Internet connection. So we live in a time when, over the next decade, 60 percent of new jobs will require more than a high school diploma. And other countries are hustling to out-educate us today, so they can out-compete us tomorrow. They want the jobs of the future. I want you to have those jobs. I want America to have those jobs. I want America to have the most highly skilled workers doing the most advanced work. I want us to win the future.
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So here is what this is going to mean. Because of this change, about 1.6 million Americans could see their payments go down by hundreds of dollars a month -- and that includes some of the students who are here today. What we’re also going to do is we’re going to take steps to consolidate student loans so that instead of paying multiple payments to multiple lenders every month -- and let me tell you, I remember this. I remember writing like five different checks to five different loan agencies -- and if you lost one that month, you couldn’t get all the bills together, you missed a payment, and then suddenly you were paying a penalty. We’re going to make it easier for you to have one payment a month at a better interest rate. And this won’t cost -- it won’t cost taxpayers a dime, but it will save you money and it will save you time.
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While I was in line I met a gentleman who came here from India with 9 bucks in his pocket, and is now the president of a community bank. This country continues to attract talent from all across the world precisely because people believe that there’s something special about this place where what you put into it means you can get that piece of the American Dream. And that’s why so many of you worked on the campaign in 2008 -- because you have that same belief. And you didn't see it reflected in our politics.
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And this is a bill that’s filled with Democratic and Republican proposals. These are the kinds of proposals that in the past would have gotten bipartisan support -- tax cuts for workers and small businesses, funding to rebuild our roads and our bridges and our schools and to put construction workers back to work, funding to hire teachers and our veterans. It’s a bill that’s fully paid for by asking those of us who've been most blessed in this society to do a little bit more, to pay a little bit more.
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Now, I agree that there are some rules and some regulations that put an unnecessary burden on businesses at a time when they can least afford it. And that’s why we’ve already identified 500 regulatory reforms that will save billions of dollars over the next year. But what we can’t do, and what I won’t do, is to let this economic crisis be used as an excuse to wipe out the basic protections that Americans have counted on for decades.
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And today, even though we’ve got a hard road to travel, we can look back on the change that we’ve made over the past three years with enormous pride. Change is the first bill I signed into law that says in this country an equal day’s work gets an equal day’s pay -- because our daughters need to have the same opportunities as all of our sons get.
Change is not just pulling this economy out of the possibilities of a Great Depression and stabilizing and making sure we didn’t have a financial meltdown, but it’s also making sure that we restored the American auto industry so that it is more profitable than it’s been in a decade. And, by the way, it’s profitable making cars that are more fuel-efficient than ever before. And we’ve now doubled fuel-efficiency standards on cars and trucks, which is going to take carbon out of our atmosphere and make us less dependent on foreign oil. That’s change that you produced. That’s what change looks like.
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Change is the reforms that we made in the financial system so that you can't have credit card companies charging you hidden fees, and lenders deceiving homeowners into mortgages that they can't afford, and Wall Street banks acting so recklessly that you end up having taxpayers bail them out. That's change.
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Now, unfortunately, Washington doesn't seem to have gotten the message yet. For the last month we’ve been debating a jobs bill. We successfully stabilized an economy that was in freefall. We prevented ourselves from going into a great depression and seeing a financial meltdown. But unemployment is brutally high.
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The second proposal is, we're going to gut regulations -- any regulations pretty much that we can see out there. We have a once-in-a-lifetime financial crisis because of irresponsibility and reckless behavior. What's your solution? Let's roll back all the regulations that might prevent reckless behavior and irresponsible actions on the part of the financial system so they can do it again.
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Change is doubling fuel standards, mileage standards, on cars and trucks -- unprecedented over the last 30 years -- and in the process saving an auto industry that is now competing all around the world and making a profit for the first time in a very long time -- and building electric cars and the cars of the future.
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Nevertheless, it is good to see so many amici. I see many proud sons and daughters of the old country. I see a couple dozen proud Italian American members of Congress here tonight. Let me offer a special welcome to the guests who join us from Italy this evening, including Italy’s ambassador to the United States, Ambassador Terzi. Thank you so much for your outstanding work. His counterpart -- here, as well, and he is doing an outstanding job representing us, our ambassador to Italy, David Thorne. Italy is one of our strongest allies, a fellow founding member of NATO. We look forward to our work together with them, and we’re going to be joining them next week at the G20 to make a series of decisions that are going to be very important for the world economy.
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And families like the Corkerys, families like yours, young people like the ones here today, including the ones who were just chanting at me, you’re the reason I ran for office in the first place. Because it’s folks like you who are why I spent so much time up here in the dead of winter four years ago. Because even then, we were going through a difficult decade for the middle class -- more good jobs in manufacturing that was leaving our shores. More of our prosperity was built on risky financial deals and homes that weren’t properly financed. And families watched their incomes fall, and wages flatline, and the cost of everything from college to health care kept on going up. And then the financial crisis hit in the closing weeks of the campaign -- and that made things even tougher.
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So a lot of the folks who have been down in New York and all across the country, in the Occupy movement, there is a profound sense of frustration -- there is a profound sense of frustration about the fact that the essence of the American Dream -- which is if you work hard, if you stick to it, that you can make it -- feels like that’s slipping away. And it’s not the way things are supposed to be. Not here. Not in America.
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It’s going to take time to rebuild an economy where hard work is valued and responsibility is rewarded. It’s going to take time to rebuild an economy that restores security for the middle class and renews opportunity for folks trying to reach the middle class. It’s going to take time to rebuild an economy that’s not based on outsourcing or tax loopholes or risky financial deals, but one that is built to last, where we invest in education and small business and manufacturing and making things that the rest of the world is willing to buy.
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Now, we can’t let that happen. Not right now. It would be bad for the economy. It would be bad for employment. That’s why my jobs bill extends that tax cut. In fact, it does it one better -– it expands the tax cut. Instead of a $1,000-a-year tax cut next year, the average working family would get a tax cut of more than $1,500. And that’s $1,500 that would have been taken out of your paycheck, would instead be going into your pocket. And that means you’d be spending in small businesses, and that would increase their business, which means they would potentially hire more people.
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I sure hope not. This isn’t about who wins or loses in Washington. This is about delivering a win for the American people. Now, a $1,500 tax cut for middle-class families -- that isn’t a Band-Aid. That is a big deal for people. How many business owners could stand to see their customers taking $1,000 less next year? That’s $1,000 less that they can spend at a small business.
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And we’ve gone through a difficult decade for middle-class Americans. More good jobs in manufacturing left our shores over the last decade. More of our prosperity was built on risky financial deals and homes that a lot of folks couldn’t afford. And a lot of you watched your incomes fall or your wages flatline. Meanwhile, the costs of everything from college to health care were all going up. And then, after all that, the financial crisis hit because of the irresponsibility of some on Wall Street. And that made things a whole lot tougher.
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We want an America where hard work is valued and responsibility is rewarded. We’re fighting to rebuild an economy that restores security for the middle class and renews opportunity for folks that are trying to get into the middle class. We’re fighting to build an economy that’s not based on outsourcing and tax loopholes and risky financial schemes, but one that’s built to last -- one where we invest in things like education and small businesses -- an economy that’s built on manufacturing and building things again and selling them all around the world.
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And that’s why my jobs bill -- part of the American Jobs Act was to extend this tax cut for another year. In fact, it does one better. It says, let’s expand that tax cut. Instead of a $1,000 tax cut next year, the typical working family under my plan would get a tax cut of $1,500. Instead of it coming out of your paycheck, it would be going into your pocket. Now, that’s money that you can spend on a small business right here in Scranton. If you’re a small business owner, my jobs bill will cut your payroll taxes in half. So if you’ve got 50 employees making $50,000 each, you’d get a tax cut of nearly $80,000. That’s money that you can then use to hire some more workers and get this economy moving again. That’s a good thing.
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Now, this really should not be controversial. A lot of Republicans have agreed with this tax cut in the past. The Republican leader in the Senate said it would -- I’m quoting here -- it would “put a lot of money back in the hands of business and in the hands of individuals.” That’s what he said. Another Republican leader said it would help small business owners create jobs and help their employees spend more money, creating even more jobs. One Republican even called it a “conservative approach to help put our economy back on track.” So what’s the problem?
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The bad news is some of those same Republicans voted “no” on my jobs bill and those tax cuts. I don’t know whether it’s just because I proposed it. I don’t know. They said “no” to cutting taxes for small business owners and working families. One of them said just two years ago that this kind of tax cut would boost job creation, and now that I’m proposing it, he said we should let it expire. I mean, what happened?
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When we came into office, the economy was contracting at 9 percent. It has grown over the last 3 years -- not as fast as we'd like, but we have been able to sustain a fairly steady pace of growth. When I came into office, we had lost 4 million jobs before I was sworn in, and 4 million jobs in the three months after I was sworn in. About six months later, we were creating jobs, and we've had private sector job growth for 20 consecutive months.
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Along the way, in addition to preventing a financial meltdown and preventing a second Great Depression, we were able to pass a historic health care bill that's going to make sure that 30 million people have coverage. We were able to pass a Wall Street reform package that, although some folks in New York are still grousing about it -- is going to ensure that we do not have the same kinds of crisis that we had in the past. We were able to make sure that we ended the war in Iraq, as promised, and by the end of this year we're going to have all of our troops out, which is going to be an extraordinary homecoming for families all across America. Thanks to the great work of folks like Debbie, we were able to end practices like "don’t ask, don't tell," make sure that we expanded college loans for millions of students all across the country.
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So a huge amount of progress has been made, but what we also know is we've still got a lot more work to do. On the domestic front -- Jack and I were just downstairs talking -- the housing market and the real estate market is still way too weak and we've got to do more. We're doing some stuff administratively. We're hoping that we can get a little more cooperation from Congress to be more aggressive in tackling the housing market and the real estate market.
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We still have to put people back to work. And I was just in Pennsylvania talking about why it's so important to make sure that we pass a -- continue, essentially, a payroll tax cut that helps small businesses and individual families so that there's more money in circulation and businesses can really latch on to this recovery and start expanding their payrolls.
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In today’s innovation economy, we also need a world-class commitment to science and research, the next generation of high-tech manufacturing. Our factories and our workers shouldn’t be idle. We should be giving people the chance to get new skills and training at community colleges so they can learn how to make wind turbines and semiconductors and high-powered batteries. And by the way, if we don’t have an economy that’s built on bubbles and financial speculation, our best and brightest won’t all gravitate towards careers in banking and finance. Because if we want an economy that’s built to last, we need more of those young people in science and engineering. This country should not be known for bad debt and phony profits. We should be known for creating and selling products all around the world that are stamped with three proud words: Made in America.
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Today, manufacturers and other companies are setting up shop in the places with the best infrastructure to ship their products, move their workers, communicate with the rest of the world. And that’s why the over 1 million construction workers who lost their jobs when the housing market collapsed, they shouldn’t be sitting at home with nothing to do. They should be rebuilding our roads and our bridges, laying down faster railroads and broadband, modernizing our schools -- all the things other countries are already doing to attract good jobs and businesses to their shores.
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But part of the deal was that we wouldn’t go back to business as usual. And that’s why last year we put in place new rules of the road that refocus the financial sector on what should be their core purpose: getting capital to the entrepreneurs with the best ideas, and financing millions of families who want to buy a home or send their kids to college.
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Of course not. Every day we go without a consumer watchdog is another day when a student, or a senior citizen, or a member of our Armed Forces -- because they are very vulnerable to some of this stuff -- could be tricked into a loan that they can’t afford -- something that happens all the time. And the fact is that financial institutions have plenty of lobbyists looking out for their interests. Consumers deserve to have someone whose job it is to look out for them. And I intend to make sure they do. And I want you to hear me, Kansas: I will veto any effort to delay or defund or dismantle the new rules that we put in place.
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The fact is this crisis has left a huge deficit of trust between Main Street and Wall Street. And major banks that were rescued by the taxpayers have an obligation to go the extra mile in helping to close that deficit of trust. At minimum, they should be remedying past mortgage abuses that led to the financial crisis. They should be working to keep responsible homeowners in their home. We’re going to keep pushing them to provide more time for unemployed homeowners to look for work without having to worry about immediately losing their house.
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We’re partnering to expand our trade and commerce. We’ll make it easier for our businesses to export and innovate together. We’ll share our experiences in agriculture and in health care. We’ll work together to develop Iraq’s energy sector even as the Iraqi economy diversifies, and we’ll deepen Iraq’s integration into the global economy.
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All of the things that we've done over the last three years -- to rescue the economy and rescue the auto industry, and end the war in Iraq and end "don't ask, don't tell," and make sure that health care is in place, and financial reform brings back some integrity to the financial sector -- all those things don't mean that much to somebody if they're still out of work right now, or their house is still underwater by $100,000.
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I said it last week, I’ll say it again: This is not just a political debate. This is a moral debate. This is an ethical debate. It’s a values debate. It’s the defining issue of our time. It is a make-or-break moment for the middle class and for all those who are fighting to get into the middle class. And for those of us who remember parents or grandparents or great-grandparents who had to fight to get in the middle class, but they understood that the American Dream was available to them because we were all in it together -- that’s what this is about. And last night, you reaffirmed the moral dimension of this debate.
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That’s what you affirmed last night. But more importantly, it’s what you affirm every day with your words and your actions. And I promise you that as you pray with your feet, I will be right there with you every step of the way. I’ll be fighting to create jobs, and give small businesses a chance to succeed. I’ll be fighting to invest in education and technology. I will fight to strengthen programs like Medicare and Social Security. I will fight to put more money in the pockets of working families. I won’t be afraid to ask the most well-off among us -– Americans like me –- to pay our fair share, to make sure that everybody has got a shot. I will fight alongside you every inch of the way.
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MR. CARNEY: Well, it’s a good question, Dan. The President’s approach has been focused on -- and his strategy has been focused on getting this very important piece of business done for the American people. He put it on the table in September as part of the American Jobs Act. He called for not just an extension of the payroll tax cut but an expansion, so that if his proposal had passed, if he got his way in entirety, Americans wouldn’t just have $1,000 extra next year, they would have had on average $1,550 extra. If he had gotten his way in his proposal entirely, small businesses would have had a payroll tax cut.
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When kids do graduate, the most daunting challenge can be the cost of college. At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July.
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The state of our Union is getting stronger. And we’ve come too far to turn back now. As long as I’m President, I will work with anyone in this chamber to build on this momentum. But I intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place.
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On the day I took office, our auto industry was on the verge of collapse. Some even said we should let it die. With a million jobs at stake, I refused to let that happen. In exchange for help, we demanded responsibility. We got workers and automakers to settle their differences. We got the industry to retool and restructure. Today, General Motors is back on top as the world’s number-one automaker. Chrysler has grown faster in the U.S. than any major car company. Ford is investing billions in U.S. plants and factories. And together, the entire industry added nearly 160,000 jobs.
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I want every American looking for work to have the same opportunity as Jackie did. Join me in a national commitment to train 2 million Americans with skills that will lead directly to a job. My administration has already lined up more companies that want to help. Model partnerships between businesses like Siemens and community colleges in places like Charlotte, and Orlando, and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers -– places that teach people skills that businesses are looking for right now, from data management to high-tech manufacturing.
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After all, innovation is what America has always been about. Most new jobs are created in start-ups and small businesses. So let’s pass an agenda that helps them succeed. Tear down regulations that prevent aspiring entrepreneurs from getting the financing to grow. Expand tax relief to small businesses that are raising wages and creating good jobs. Both parties agree on these ideas. So put them in a bill, and get it on my desk this year.
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There’s never been a better time to build, especially since the construction industry was one of the hardest hit when the housing bubble burst. Of course, construction workers weren’t the only ones who were hurt. So were millions of innocent Americans who’ve seen their home values decline. And while government can’t fix the problem on its own, responsible homeowners shouldn’t have to sit and wait for the housing market to hit bottom to get some relief.
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Let’s never forget: Millions of Americans who work hard and play by the rules every day deserve a government and a financial system that do the same. It’s time to apply the same rules from top to bottom. No bailouts, no handouts, and no copouts. An America built to last insists on responsibility from everybody.
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And I will not go back to the days when Wall Street was allowed to play by its own set of rules. The new rules we passed restore what should be any financial system’s core purpose: Getting funding to entrepreneurs with the best ideas, and getting loans to responsible families who want to buy a home, or start a business, or send their kids to college.
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And tonight, I’m asking my Attorney General to create a special unit of federal prosecutors and leading state attorney general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. This new unit 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.
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We don’t begrudge financial success in this country. We admire it. When Americans talk about folks like me paying my fair share of taxes, it’s not because they envy the rich. It’s because they understand that when I get a tax break I don’t need and the country can’t afford, it either adds to the deficit, or somebody else has to make up the difference -- like a senior on a fixed income, or a student trying to get through school, or a family trying to make ends meet. That’s not right. Americans know that’s not right. They know that this generation’s success is only possible because past generations felt a responsibility to each other, and to the future of their country, and they know our way of life will only endure if we feel that same sense of shared responsibility. That’s how we’ll reduce our deficit. That’s an America built to last.
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Folks at the very, very top saw their incomes rise like never before, but most Americans, most folks in Iowa, were just trying to stay afloat. And that was before the financial crisis hit in 2008.
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Look what happened in our auto industry. On the day I took office, it was on the verge of collapse. And some even said we should let it die. I’ve got the clips in case -- because I remember. They were beating the heck out of me. “Why are you doing this? Why are you intervening?”
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But we stood to lose a million jobs -- not just in the auto industry, but all the suppliers, all the related businesses. So I refused to let that happen.
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In exchange for help -- see, keep in mind, that the administration before us, they had been writing some checks to the auto industry with asking nothing in return. It was just a bailout, straight -- straightforward. We said we’re going to do it differently.
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In exchange for help, we also demanded responsibility from the auto industry. We got the industry to retool and to restructure. We got workers and management to get together, figure out how to make yourselves more efficient.
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And over the past two years, that entire industry has added nearly 160,000 jobs. GM is number one in the world again. Ford is investing billions in new American plants. Chrysler is growing faster. So today, the American auto industry is back.
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But we’ve got to seize that opportunity. We’ve got to help these companies succeed. And it starts with changing our tax code. It starts with changing our tax code.
Now, right now, companies get all kinds of tax breaks when they move jobs and profits overseas. Think about that. A company that chooses to stay in America gets hit with one of the highest tax rates in the world. That’s wrong. It doesn’t make sense. We’ve got to stop rewarding businesses that ship jobs overseas, reward companies like Conveyor that are doing business right here in the United States of America.
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Look at what’s happened in the auto industry. On the day I took office, it was on the verge of collapse. Some people said we should let it die. But we had a million jobs at stake, and I refused to let that happen. And so we said to the auto companies, in exchange for help, we’re going to demand responsibility. We’ve got to make sure that the industry retools and restructures. And that’s what they did. And over the past two years, the entire industry has added nearly 160,000 jobs. GM is number one in the world again. Ford is investing in new plants. Chrysler is on the mend. The American auto industry is back.
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Right now, companies get all kinds of tax breaks when they move jobs and profits overseas. But when a company chooses to stay in America, it gets hit with one of the highest tax rates in the world. That doesn’t make sense. We’ve been talking about changing it for years. Republicans and Democrats have said that doesn’t make sense. Well, let’s get it done. Let’s stop rewarding businesses that ship jobs overseas. Let’s reward companies like Intel that are investing and creating jobs right here in the United States of America.
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Now, look, we live in a global economy. If a company wants to do business overseas, of course it’s their right. But we shouldn’t subsidize it. What we should do are subsidize and help and give tax breaks to companies that are investing here, that bring jobs back from overseas, high-tech manufacturers like Intel.
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And so on Tuesday, I talked about the job we’ve got to get done as a nation, all of us -- the job of restoring the American promise, the idea that if you work hard, if you fulfill your responsibilities, then you can do well enough to raise a family and own a home, send your kids to college, put a little away for retirement, live out that American Dream.
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Now, I’m here to talk a little more about what I talked about at the State of the Union on Tuesday night. And what I want to focus on is how we’re going to restore the basic promise of America, something that folks at UPS understand, which is, if you work hard, if you do the right thing, you should be able to do well enough to raise a family and own a home and send your kids to college and put a little away for retirement. That’s the American Dream. That’s what most people are looking for.
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My commitment is deeper than our unique nation-to-nation relationship. It’s a commitment to making sure that we get that relationship right. Native Americans have to be full partners in our economy. Your children and your grandchildren have to have an equal shot at the American Dream.
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We want new businesses and new opportunities to take root on the reservation. We want to stop repeating the mistakes of the past and begin building a better future -- one that honors old traditions and also welcomes every single Native American into the American Dream.
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And this is not a new trend. This is something that's been going on for years now. Wages and incomes stagnant at the same time that costs keep going up and up and up. Outsourcing, and jobs moving elsewhere. Young people wondering, even if they invest in a college degree, are they going to be able to find a job that supports an ever-increasing load of debt. And all of that was before the economic crisis hit in 2008-2009 that put millions of people out of work.
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Now, here's the good news. The good news is that we are moving in the right direction. Thanks to your efforts, thanks to some tough votes that all of you took, thanks to the leadership that Nancy Pelosi and the rest of the leadership team showed, we righted the ship. We did not tip into a Great Depression. The auto industry was saved. Credit started flowing to small businesses again. And over the last 22 months, we have seen 3 million jobs created, the most jobs last year since 2005, more jobs in manufacturing than we’ve seen since the ‘90s. A lot of that has to do with tough decisions that you took.
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Making college more affordable, which I just spoke about at Michigan -- we’ve got an average of $24,000 worth of debt for every young person that's graduating right now. They're starting off in a hole that most of us didn't have to start off with, and it’s brutal. And there are ways we can solve it. This caucus helped to make sure that we increased Pell Grants, and we increased student aid, but now -- there's some concrete things we’ve got to do right now, like making sure that the interest rates don't double on student loans this year, in July. We’re going to require Congress to act.
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The same way that they understand we’re going to have to keep in place smart regulations that assure that a health care company can’t drop you right when you get sick, or charge women differently than men. These other folks want to roll back financial regulatory reform. After all that we’ve been through, you want to water down and weaken rules that make sure that big banks and financial institutions have to play by the same rules as everybody else? That makes no sense.
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And the degree you earn from Michigan will be the best tool you have to achieve that basic American promise -- the idea that if you work hard, if you are applying yourself, if you are doing the right thing, you can do well enough to raise a family and own a home and send your own kids to college, put away a little for retirement, create products or services -- be part of something that is adding value to this country and maybe changing the world. That's what you're striving for. That's what the American Dream is all about.
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On the day I took office, with the help of folks like Debbie Stabenow, your senator, and Carl Levin and -- John Conyers -- the American auto industry was on the verge of collapse. And some politicians were willing to let it just die. We said no. We believe in the workers of this state. I believe in American ingenuity. We placed our bets on the American auto industry, and today, the American auto industry is back. Jobs are coming back -- 160,000 jobs.
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So that’s what we’ve been doing. Now Congress has to do more. Congress needs to do more. They need to stop the interest rates on student loans from doubling this July. That's what’s scheduled to happen if Congress doesn't act. That would not be good for you. So you should let your members of Congress know: Don't do that. Don't do it. Don't do it.
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One of the top priorities that I mentioned during the State of the Union was the need for us to promote small business. And I’m very pleased that we’ve got Karen Mills here, who has participated in our meetings before, but is now an official member of the Cabinet.
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And that was a set of challenges that were decades in the making. We never expected to solve those overnight, but what we understand is that the defining issue of our time is how we restore the basic promise of the American Dream.
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AUDIENCE MEMBER: I decided to show up.
But, look, we’ve gone through three of the toughest years that we’ve seen in our lifetimes. And a lot of folks are still hurting out there. But as I said at the State of the Union last week, we’re beginning to see progress. We averted a great depression. The auto industry has come back and GM is number one again. I just went to the auto show today to see some of the terrific cars that Detroit is churning out.
We’ve had 3 million jobs created over the last 22 months and we had the highest job growth last year since 2005, the highest manufacturing job growth since the 1990s. There is a sense that although there's still a lot of uncertainties out there -- Europe, the price of oil -- that America is slowly repairing from this extraordinary economic and financial crisis.
And during the last three years, even as we singularly focused on making sure that we were able to right the ship, we were also able to accomplish a lot of goals that we had set for ourselves in 2008 -- whether it was passing health care reform so that already 2.5 million young people have insurance that wouldn’t have it otherwise and senior citizens are seeing discounts on their prescription drugs, and we’re now setting up exchanges all across the country so that never again would somebody with a preexisting condition finds themselves barred from being able to get health insurance.
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And last week at the State of the Union, I laid out a blueprint for how we get there that involves rebuilding American manufacturing and replicating the success we’ve had in the auto industry across the board. It means revitalizing how we train our young people for the jobs of the 21st century, creating skills for American workers, not just through four-year colleges but also through two-year colleges.
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As Rob said, the last three years we've obviously gone through historic times, a set of historic challenges -- the worst economic crisis and financial crisis since the Great Depression, two wars, a transformation of our geopolitics. And I couldn't be prouder of the track record that we've been able to put together over the last three years -- not only in preventing us from sliding into a Great Depression, not only shifting from a situation where we were losing 800,000 jobs per month to 22 consecutive months of job growth, the highest manufacturing job growth since the '90s, the largest job growth, period, last year since 2005, passing historic health care legislation that we're in the process now of implementing, tough Wall Street reform legislation that is going to make sure that we don't see the same kind of reckless behavior that got us into this mess in the first place, along with a set of laws that are going to make sure that the values we care so deeply about are the law of the land --things like ending "don’t ask, don't tell," or making sure that people are actually getting equal pay for equal work, one of the strongest environmental records of any President in the modern era.
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This past Tuesday, I tried to lay out that vision, that blueprint for how we move forward, involving resuscitating American manufacturing -- the same way we've done with the auto industry, we can do that across the board. American energy -- how do we, yes, make sure that American oil production and natural gas are properly produced, but how do we also make sure that we're still investing in clean energy and looking 10, 20, 30 years down the road and making sure that we're at the forefront of the kind of clean energy economy that I think everybody is going to have to adjust to.
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And how do we make sure that we've got a set of regulations in place that aren’t designed to squelch entrepreneurial activity and the free market but are designed to make sure that our consumers are protected and that our air is clean and our water is clean and that we don't see another crisis like we saw in the housing market.
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But we're going to have to fight for it, because the other party has a fundamentally different vision about where to take this country. Their basic argument is, is that if we strip out regulations, if we disregard environmental concerns, if we take away protections for consumers, if we lower taxes even further for the kind of folks who are in this room, that somehow growth and the American Dream will be restored. And I fundamentally disagree with that vision. I think it's the wrong vision for America.
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I know that the Department of Commerce, Energy, and Education, as well as the SBA, are all launching complementary initiatives to support entrepreneurship as well. And so what we want to do is to make sure that every single agency, even as they’re tending to their energy initiatives or providing homeland security or transportation or defense, that we’re also thinking about how are we advancing the cause of giving small businesses and entrepreneurs opportunities to start creating the next Google or the next Apple or the next innovative company that’s going to create jobs and improve our economy.
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Let me just say, when you look at all these cars, it is testimony to the outstanding work that's been done by workers -- American workers, American designers. The U.S. auto industry is back. The fact that GM is back, number one, I think shows the kind of turnaround that's possible when it comes to American manufacturing.
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Let me start by just saying thank you to Peter for sharing his story. I love bookstores, so it was fun hearing how he's coming back. And we are very grateful to him, and small business owners all across the country who, every day, are getting up and doing what's required to make payroll and support a lot of families out there.
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Our decision to rescue the American auto industry from collapse, even when there were a bunch of politicians saying we should let Detroit go bankrupt. And now, because we didn’t let a million jobs go, today GM is back on top as the world's number-one automaker. Just reported the highest profits in its 100-year history. And with more than 200,000 new jobs created in the last two-and-a-half years, the American auto industry is back. That’s what change is. That’s what you did.
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And, yes, change is the health care reform bill we passed after century of trying. That’s a reform that will finally ensure that in the United States of America, nobody goes broke because they get sick. And already, 2.5 million young people have health insurance today because the law allows them to stay on their parent's plan. And because of this law, Americans no longer can be denied or dropped by their insurance companies when they need care the most. That’s what change is.
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The recovery is accelerating. America is coming back -- which means the last thing we can do is go back to the same failed policies, the very same policies that got us into this mess in the first place. And that’s what’s at stake in this election. That’s exactly what the other candidates want to do. They don’t make any secret about it. They want to go back to the days when Wall Street played by its own rules. They want to go back to the days when insurance companies could deny you coverage or jack up premiums without reason. They want to go back to spend trillions of dollars more on tax breaks for folks like me, for the wealthiest Americans, even if it means adding to the deficit, or gutting things like education or clean energy or making Medicare more expensive for seniors.
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We've obviously gone through the toughest three years in my lifetime -- the toughest three years economically since the Great Depression. The month I was sworn in we were losing 750,000 jobs a month. We had lost 4 million jobs in the six months before I was sworn into office. We would lose another 4 million in the six months after I was sworn in, before our economic policies had a chance to take effect. The housing market was decimated. People lost jobs. They saw their homes underwater, in some cases, hundreds of thousands of dollars where they would never probably recover all the equity in their homes.
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At the same time, though, what we're starting to see is the incredible resilience of the American people and the American economy. So this month, we saw 250,000 jobs created. I'm sure some of it had to do with Microsoft -- (laughter.) That's a million-job swing. We've now had 23 consecutive months of job growth, about 3.7 million jobs being created, the highest manufacturing job growth since the 1990s. And you get a sense as you talk to small businesses, large businesses, people across the country, there is a sense that we may have gotten through the heaviest storms.
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Across the board, we have made tough decisions -- whether it's saving the auto industry, or making sure that we have a health care system that actually works for our economy. And there have been times, let's face it, during the last three years, where some of you have said, hmm, I'm not sure it's working out. But what we've always been convinced of, what I've always been convinced of, is that if we sustain this effort, even in the face of huge political obstacles, that, eventually, not only would the economy come back, but eventually our politics would align with common sense and our traditions of hard work and mutual responsibility -- the basic idea that, yes, we're rugged individualists and we're entrepreneurs, and we focus on what we can accomplish on our own, and we don’t ask for handouts or expect anybody to do anything for us, but we're also part of something bigger -- part of neighborhoods and communities, and a United States of America, and that if we keep that in mind, then there's nothing we can't accomplish.
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Congress needs to step up and support America's small businesses, and especially companies that want to export. It's time we stop rewarding businesses that send jobs overseas, start rewarding companies right here that want to create jobs in the United States and sell to other countries as opposed to exporting jobs to other countries. That’s what we need to do. Congress can act on that.
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We still have some struggles out there. We're coming out of the worst economic crisis in our lifetimes. We've got a long way to go before every single person who’s looking for a job can find a job. But where we stand now looks a lot different than where we stood a few years ago. Over the last 23 months, businesses have created 3.7 million new jobs. Manufacturers are hiring for the first time since the 1990s. The auto industry is back on top. Our recovery is gaining steam. Our economy is getting stronger. So we’re headed in the right direction. And the last thing we should do is turn around and go back to the policies that weren’t working in the first place.
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And the reason I'm so confident in our future is because of the folks who are standing with me today, some of the folks who are in the audience, because of all the families and workers and small business owners and students and seniors that I’ve met over the last few weeks and that I’ve met during the course of my political career. When times are tough, Americans don’t give up. They push ahead. They do whatever it takes to make their lives better, their communities better and their countries better.
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Now, none of the steps that I’ve talked about today is going to be a silver bullet. It’s not going to bring down gas prices tomorrow. Remember, if anybody says they got a plan for that -- what?
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Think about where we were in 2008. And sometimes people forget. The stock market was in a freefall. We were losing 750,000 jobs a month. The bottom had fallen off of the housing market. The entire financial system was locked up. Blue-chip companies couldn't borrow money. And people weren't certain whether we were going to spiral into a Great Depression.
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Three years later, instead of losing 750,000 jobs a month, we created 250,000 last month. Over the last two years, we've created 3.7 million jobs in the private sector. And we've actually seen manufacturing job growth for the first time since the 1990s. So the economy is moving in the right direction. We've got some headwinds -- Europe is still weak, gas prices are a huge burden on families. But overall, considering where we were and where we could have been, I think most Americans recognize that things have stabilized and we're moving in a better direction.
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We said that we've got to start developing American energy. We've doubled clean energy since I've been President. And even as we've increased production of oil, we've recognized we've got to transition so that our kids and our grandkids are able to enjoy not only economic growth and not be dependent on what's happening in the Middle East or someplace else, but also we're able to protect the planet.
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And it means that we have a tax system that encourages economic growth, that helps to bring down our deficit, that pays for the investments that we need, and says folks like me can afford to do a little bit more -- that it doesn’t make sense to give me tax breaks I don’t need if it means making some senior citizen pay more for her Medicare, or making a student pay more for their student load, or a veteran maybe doesn’t get the kind of help that they need coming home and they’ve got Post Traumatic Stress Disorder.
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The reason you got involved was because we had a shared vision about what America could be, what America should be. We had an idea of a shared vision of an America in which everybody who works hard, everybody who has a vision of where they want to take their life, they can succeed. It doesn’t matter where you come from, it doesn’t matter what you look like, doesn’t matter what your name is. That idea that if you worked hard and took responsibility, that you could buy a home, and send your kids to college, and retire with dignity and respect, put a little bit away -- that core American Dream felt like it was slipping away for too many people all across the country.
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Because of you, we were able to take $60 billion that was going to subsidize banks in the student loan program, and we said why aren’t we sending that money directly to students? And as a consequence, we now have millions of young people all across the country who are getting higher Pell grants, or are eligible for Pell grants for the first time, or are seeing their student loan interest rates lower, have access to college and the keys to the American Dream. That happened because of you. That's what change is.
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Change is the decision to rescue the American auto industry from collapse. You remember there were a lot of people who didn’t believe in that. Even when some politicians said we should just let Detroit go bankrupt, we stepped up. And as a consequence, probably a million jobs were saved, and the American auto industry has come roaring back, and GM is now once again the number-one automaker in the world. That happened because of you.
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Now, that’s what the other candidates want to do. I don’t know if you guys have been watching the Republican primary debates, in case you need an incentive. They make no secret about what they want to do. They want to go back to the days when Wall Street played by its own rules. They want to go back to the days when insurance companies could deny you coverage or jack up your premiums without reason. They want to spend trillions more on tax breaks for the wealthiest individuals, for people like me, who don’t need it, weren’t even asking for it -- even if it means adding to the deficit, even if it means gutting our investments in education or clean energy, or making it harder for seniors on Medicare. Their philosophy is simple: We are better off when everybody is left to fend for themselves, everybody makes their own rules, a few do very well at the top and everybody else is struggling to get by. That’s their core vision for America.
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This has never been a Democratic or Republican idea. This is an American idea. It was the first Republican President, Abraham Lincoln, who launched a Transcontinental Railroad, the National Academy of Sciences, the first land-grant colleges, all in the middle of the Civil War. Think about that. I'm sure there were some folks at the time who were saying, "Why are we doing all that? I don't want to pay for that." But that laid the groundwork for a national economy.
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Now, right now we are experiencing just another painful reminder of why developing new energy is so critical to our future. Just like last year, gas prices are climbing across the country. This time, it’s happening even earlier. And when gas prices go up, it hurts everybody -- everybody who owns a car, everybody who owns a business. It means you’ve got to stretch a paycheck even further. It means you’ve got to find even more room in a budget that was already really tight. And some folks have no choice but to drive a long way to work, and high gas prices are like a tax straight out of your paycheck.
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And after three decades of inaction, we put in place the toughest fuel economy standards in history for our cars and pickup trucks -– and the first standards ever for heavy-duty trucks. And because we did this, our cars will average nearly 55 miles per gallon by the middle of the next decade. That's nearly double what they get today.
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First of all, while there are no silver bullets short term when it comes to gas prices -- and anybody who says otherwise isn't telling the truth -- I have directed my administration to look for every single area where we can make an impact and help consumers in the months ahead, from permitting to delivery bottlenecks to what’s going on in the oil markets. We're going to look at every single aspect of gas prices, because we know the burden that it's putting on consumers. And we will keep taking as many steps as we can in the coming weeks.
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We've gone through three of the toughest years this country has gone through in my lifetime. And there are a lot of people who are still hurting all across the country -- a lot of people here in Florida, a lot of people everywhere. There are still folks whose homes are underwater because the housing market collapsed. There are people who are still struggling because they can't find a job. There are folks who are just barely able to make ends meet. And obviously those of us who are here, we've been incredibly blessed. But one of the great things about America and one of the great things about those who are in professional sports is we've all got cousins, uncles, family members who are still struggling and are a reminder that we have a lot more work to do.
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Today there's no doubt that enormous challenges remain. But the fact of the matter is that over the last two years American businesses have created 3.7 million new jobs. Manufacturers are hiring for the first time since the 1990s. The auto industry is back. Our recovery is gaining speed and the economy is getting strong. And we’ve got to do everything we can to make sure that we sustain this progress.
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That means we’ve got to strengthen American manufacturing so that more and more good jobs and products are made here in America. It means that we’ve got to develop new sources of American energy so that we’re less dependent on foreign oil and yearly spikes in gas prices. And it means that we’ve got to make sure that every American is equipped with the skills, with the education that they need to compete for the jobs of tomorrow as well as the jobs of today. And that’s what I want to talk to these governors a little bit about.
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Now, for students that are ready for college, we've got to make sure that college is affordable. Today, graduates who take out loans leave college owing an average of $25,000. That’s a staggering amount for young people. Americans now owe more in student loan debt than they do in credit card debt. There's so many Americans out there with so much to offer who are saddled with debt before they even start out in life. And the very idea of owing that much money puts college out of reach for far too many families.
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Take a minute and think about what you and the workers and the families that you represent have fought through. A few years ago, nearly one in five autoworkers were handed a pink slip -- one in five. Four hundred thousand jobs across this industry vanished the year before I took office. And then as the financial crisis hit with its full force, America faced a hard and once unimaginable reality, that two of the Big 3 automakers -- GM and Chrysler -- were on the brink of liquidation.
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The heartbeat of American manufacturing was flat-lining and we had to make a choice. With the economy in complete free fall there were no private investors or companies out there willing to take a chance on the auto industry. Nobody was lining up to give you guys loans. Anyone in the financial sector can tell you that.
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More than one million Americans across the country would have lost their jobs in the middle of the worst economic crisis since the Great Depression. In communities across the Midwest, it would have been another Great Depression. And then think about all the people who depend on you. Not just your families, but the schoolteachers, the small business owners, the server in the diner who knows your order, the bartender who’s waiting for you to get off. That’s right. Their livelihoods were at stake as well.
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So, no, we were not going to take a knee and do nothing. We were not going to give up on your jobs and your families and your communities. So in exchange for help, we demanded responsibility. We said to the auto industry, you're going to have to truly change, not just pretend like you're changing. And thanks to outstanding leadership like Bob King, we were able to get labor and management to settle their differences.
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And now, three years later -- three years later, that bet is paying off -- not just paying off for you, it’s paying off for America. Three years later, the American auto industry is back. GM is back on top as the number-one automaker in the world -- highest profits in its 100-year history. Chrysler is growing faster in America than any other car company. Ford is investing billions in American plants, American factories -- plans to bring thousands of jobs back to America.
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I know our bet was a good one because I had seen it pay off firsthand. But here’s the thing. You don't have to take my word for it. Ask the Chrysler workers near Kokomo -- who were brought on to make sure the newest high-tech transmissions and fuel-efficient engines are made in America. Or ask the GM workers in Spring Hill, Tennessee, whose jobs were saved from being sent abroad. Ask the Ford workers in Kansas City coming on to make the F-150 -- America’s best-selling truck, a more fuel-efficient truck. And you ask all the suppliers who are expanding and hiring, and the communities that rely on them, if America’s investment in you was a good bet. They’ll tell you the right answer.
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Or you've got folks saying, well, the real problem is -- what we really disagreed with was the workers, they all made out like bandits -- that saving the auto industry was just about paying back the unions. Really? I mean, even by the standards of this town, that’s a load of you know what.
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They think the best way to help families afford health care is to roll back the reforms we passed that’s already lowering costs for millions of Americans. They want to go back to the days when insurance companies could deny your coverage or jack up your rates whenever and however they pleased. They think we should keep cutting taxes for those at the very top, for people like me, even though we don’t need it, just so they can keep paying lower tax rates than their secretaries.
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So in short, the international community has made it harder than ever for terrorists to acquire nuclear weapons, and that has made us all safer. We’re building an international architecture that can ensure nuclear safety. But we’re under no illusions. We know that nuclear material, enough for many weapons, is still being stored without adequate protection. And we know that terrorists and criminal gangs are still trying to get their hands on it -- as well as radioactive material for a dirty bomb. We know that just the smallest amount of plutonium -- about the size of an apple -- could kill hundreds of thousands and spark a global crisis. The danger of nuclear terrorism remains one of the greatest threats to global security.
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Russia's ascension into the WTO can open up trade and commerce between our two countries that can create jobs and economic growth for both Russians and Americans. And as Dmitry mentioned, we think it's going to be very important for us to address Jackson-Vanik so that American businesses can fully take advantage of an open and liberalized Russian market.
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Like the G20 summit two years ago, this gathering is a tribute to the nations that contribute to security and peace that's playing a leading role around the globe and that's taking its rightful place on the world stage. When I hosted the first Nuclear Security Summit two years ago in Washington, there were those who questioned whether our nations could summon the will to confront one of the gravest dangers of our time. In part because it involves a lot of technical issues, in part because the world was still grappling with a whole host of other issues like the economy and the global recession, there was some skepticism that we would be able to sustain an effort around this topic. But that's exactly what we've done.
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Obviously, the United States and Pakistan have a host of mutual interests. We’re both interested in combating terrorism, both internationally and in our respective countries. We both are interested in economic development. We’re both interested in nuclear security, as evidenced by our presence here today. And we have been working together because we’re both interested in a stable and secure Afghanistan and a stable and secure region that will benefit not only Pakistan but also the entire world.
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And keep in mind, we can’t just drill our way out of this problem. As I said, oil production here in the United States is doing very well, and it's been doing well even as gas prices are going up. Well, the reason is because we use more than 20 percent of the world’s oil but we only have 2 percent of the world’s known oil reserves. And that means we could drill every drop of American oil tomorrow but we’d still have to buy oil from other countries to make up the difference. We’d still have to depend on other countries to meet our energy needs. And because it’s a world market, the fact that we’re doing more here in the United States doesn’t necessarily help us because even U.S. oil companies they’re selling that oil on a worldwide market. They’re not keeping it just for us. And that means that if there’s rising demand around the world then the prices are going to up.
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Change is the decision we made to rescue an auto industry that was on the verge of collapse, even when some said let Detroit go bankrupt. One million jobs were at stake, so we weren’t going to let that happen. And today, GM is back on top as the world’s number one automaker, reported the highest profits in 100 years -- 200,000 new jobs over the last two and a half years. The American auto industry is back and it's making cars that are more fuel-efficient. So that’s helping the environment, even as we’re putting people to work.
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But that’s what the other side wants to do. They make no secret about it. They want to go back to the days where Wall Street played by its own rules. They want to go back to the day when insurance companies could do whatever they wanted to. They want to go back to the days where -- they want to continue to spend trillions of dollars on tax breaks for the wealthiest individuals in America, even if it means adding to the deficit, or gutting education, or gutting investments in clean energy, or hurting Medicare.
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And when kids do graduate, the most daunting challenge can be the cost of college. When Americans owe more tuition debt than they do credit card debt, you know we’ve got a problem. Now, the first thing we’ve got to do -- Congress has to stop interest rates that are currently scheduled to go up in July on student loans, which will be a huge problem for a lot of young people. I’ve already asked Congress to do it. They haven’t done it -- shocking enough -- they haven’t done it so far. And colleges and universities have to do their part, too, to keep tuition from going up -- because higher education cannot be a luxury. It is an economic imperative that every family in America should be able to afford.
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We know this from our own lives. If we attract some outstanding young person to become a teacher by giving them the pay and the support that they deserve, and that teacher goes on to educate the next Steve Jobs, well, we all benefit. We all do better. America rises. If we’re providing faster Internet to rural America so that some small business owner suddenly can sell his or her goods around the world, that’s good for all of us. If we build a new bridge that saves a shipping company time and money, then workers and customers all around the country benefit. They do better. That’s how America became an economic superpower.
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We've gone through a tough three years, this country -- as tough as any in our lifetime. The worst financial crisis since the Great Depression. The economic aftermath that left millions without work. A collapsed housing market. It's hard to remember sometimes how perilous things were when I was sworn in. The month I was sworn into office, we lost 800,000 jobs in that month alone. We had lost almost 4 million in the months before I took office. And then we would just keep on shedding jobs for the first few months that I was sworn in. The banks were locked up, so even blue-chip companies couldn't get credit. People, I think, genuinely thought that you might see a world financial meltdown. And nobody exactly knew where the bottom was. The stock market, by the way, was about half of what it is today.
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And that meant we had to move fast to save the auto industry, to get the banks lending again, to make sure that state governments and local governments didn't have to lay off even more teachers and first responders and others that were providing vital services but, frankly, the states and local governments were having trouble being able to afford.
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And we moved so fast that in some ways, people didn't fully appreciate the scope and magnitude of what got done in those first six months, that first year. Here's the good news -- as you look back, from where we were to where we are now, over the last two years we've created almost 4 million jobs. We have the strongest manufacturing job growth since the 1990s. The auto industry is back, stronger than it was before. GM is once again the number-one auto company in the world, making profits that are higher than at any time in its 100-year history. We have seen the unemployment rate start ticking down. We're seeing companies hiring again, companies investing again. There's a sense that things have stabilized, and that we can start getting back to where we were before this terrible storm.
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That's why we followed through on the commitment I made to make sure that people don't go bankrupt when they get sick and passed the Affordable Care Act. And already you've got 2.5 million young people who have health insurance because of it. And already, everybody here who has insurance has protections that are more robust than the patient's bill of rights that had been debated in the 1990s and that had never gotten done. And seniors are benefiting from lower prescription drugs because of it. And small businesses are getting subsidies so that they can provide health insurance to their workers.
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It means that we have to preserve the gains we've made when it comes to respecting science. But it also means that when it comes to education, we've still got kids who are dropping out, unable to read, and they can't compete in this global economy. So we're going to have to do more work there.
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And yet one of the things that always gave me confidence was, as I traveled around the country, both first as a candidate and then as President, what I continually saw was the incredible resilience and strength and imagination of the American people. And so even during the darkest days of this recession, I always had confidence that America would bounce back. It was not a matter of if, it was a matter of when. And the question was would we be able to pull the country together and move not only to get us back to where we were before the financial crisis, but to solve these ongoing problems that we'd been putting off for decades.
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But I think all of us are here today because we know our job isn't finished. We've got a lot more to do. We still have to do more to make sure that people who don't have work can find work. We're going to have to do more to make sure that our housing system is working for everybody and that people can start recovering from the beating that they've taken with the decline in the real estate market.
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Change is the decision that we made to rescue the American auto industry. There were a million jobs at stake. There were those who said let Detroit go bankrupt. We didn’t do it, and today GM is back on top as the world’s number-one automaker. And Detroit has never made better cars than it does today. With more than 200,000 new jobs over the last two and a half years, the American auto industry is back. And they’re making better cars, and more fuel-efficient cars than ever before. That’s what change is.
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But, of course, that’s exactly what the other side -- all those folks who are running for this office -- that’s exactly what they’re proposing. They don’t make any secret about it. They want to go back to the days when Wall Street played by its own rules. They want to roll back health care so that insurance companies can jack up your rates or whatever they want. They want to continue to spend trillions of dollars more on tax breaks for the wealthiest individuals, even if it means adding to the deficit, even if it means gutting things like education, and basic research, and clean energy and Medicare -- all those things that help this economy grow.
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When kids do graduate, right now they’re having trouble financing their college educations. When Americans owe more in tuition debt than credit card debt, you know that’s a problem. And that’s why -- coming up in July, by the way, if Congress doesn’t do anything, the interest rates on student loans are going to go up, they’re going to double.
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And we know that from our own experience. Look, if we attract an outstanding young person to go into teaching because we’re paying them well, we’re giving them support, professional development, and they go on to teach the next Steve Jobs, that’s good for all of us. If we provide faster Internet service to some rural part of Maine and there’s some small business out there that suddenly has access to a worldwide market, that’s good for the entire economy. If we build a new bridge that saves a shipping company time and money, well, workers and customers all over the country, they benefit.
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For a lot of working families, the idea of owing that much money means higher education is simply out of reach for their children. And for the first time now we’ve got Americans owing more debt on their student loans than they do on their credit cards.
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Five years ago, Congress cut the rate on federal student loans in half. That was a good thing to do. But on July 1st -- that’s a little over two months from now -- that rate cut expires. And if Congress does nothing, the interest rates on those loans will double overnight.
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So the key point I want to make: If Congress doesn’t act on July 1st, interest rates on Stafford loans, on student loans from the federal government will double. Nearly 7.5 million students will end up owing more on their loan payments. And that would be, obviously, a tremendous blow. And it’s completely preventable.
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And for some time now, I’ve been calling on Congress to take steps to make higher education more affordable, to prevent these interest rates from doubling, and to extend the tuition tax credit that has saved middle-class families millions of dollars, but also, to double the number of work/study jobs over the next five years.
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So the bottom line here is we can’t just cut our way to prosperity. Making it harder for our young people to afford higher education, allowing them to earn their degrees -- that’s nothing more than cutting our own future off at the knees. And Congress has to keep interest rates on student loans from doubling, and they need to do it now.
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Because we don’t want Congress to double the interest rates on so many students. We need to reward hard work and responsibility. And part of that is keeping interest rates on student loans low so more Americans get a fair shot at an affordable college education, the skills they need to find a good job, a clear path to the middle class that’s not blocked by a mountain of debt. And the time to act is right now, and I’m going to need your help getting that message out.
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Now, I know that those of you who are about to graduate are wondering about what’s in store for your future. Not even four years ago, just as the global economy was about to enter into freefall, you were still trying to find your way around campus. And you’ve spent your years here at a time when the whole world has been trying to recover, but has not yet fully recovered from the worst economic crisis since the Great Depression, the worst economic crisis in most of our lifetimes -- and that includes your teachers.
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So we’ve still got a lot of work to do to rebuild this economy so that it lasts, so that it’s solid, so that it’s firm. But what I want you to know is that the degree you earn from UNC will be the best tool you have to achieve that basic American promise -- the idea that if you work hard, you can do well enough to raise a family and own a home, send your own kids to college, put a little away for retirement. That American Dream is within your reach.
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Americans now owe more on their student loans than they do on their credit cards. And living with that kind of debt means that this generation is not getting off to the same start that previous generations -- because you’re already loaded up with debt. So that means you’ve got to make pretty tough choices when you are first starting out. You might have to put off buying a house. It might mean that you can’t go after that great idea for a startup that you have, because you’re still paying off loans. Maybe you’ve got to wait longer to start a family, or save for retirement.
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When a big chunk of every paycheck goes towards loan debt, that’s not just tough on you, that’s not just tough for middle-class families, it’s not just tough on your parents -- it’s painful for the economy, because that money is not going to help businesses grow. I mean, think about the sooner you can start buying a house, that’s good for the housing industry. The sooner you can start up that business, that means you’re hiring some folks -- that grows the economy.
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And then there's one specific thing -- and now this is where you come in -- there's one specific thing that Congress needs to do right now to prevent the interest rates on student loans, federal student loans, from shooting up and shaking you down. So this is where you come in. I want to explain this, so everybody listen carefully.
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So I’m assuming a lot of people here have federal student loans. The interest rates will double unless Congress acts by July 1st. And just to give you some sense of perspective -- for each year that Congress doesn’t act, the average student with these loans will rack up an additional $1,000 in debt -- an extra thousand dollars. That’s basically a tax hike for more than 7 million students across America -- more than 160,000 students here in North Carolina alone. Anybody here can afford to pay an extra $1,000 right now?
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Now, that’s their priorities. And that doesn’t make any sense. Do we want to keep tax cuts for the wealthiest Americans who don’t need them and didn’t ask for them? Or do we want to make sure that they’re paying their fair share? Do we want to keep subsidizing big oil, or do we want to make sure we’re investing in clean energy? Do we want to jack up interest rates on millions of students, or do we want to keep investing in things that will help us and help them in the long-term -- things like education and science, and a strong military and care for our veterans? We can’t do both. We can’t have it both ways. We’ve got to make a choice about what our priorities are.
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You know, I’ve said this before, but I’m just going to keep on repeating it: In America, we admire success. We aspire to it. I want everybody to be rich. I want everybody to work and hustle and start businesses and study your tails off to get there. But America is not just about a few people doing well. America is about giving everybody a chance to do well. Everybody -- not just a few -- everybody. That’s what built this country. That’s what the American Dream is all about.
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And then there's something that they’ve got to do right now. They have to prevent the interest rates on federal student loans from shooting up and shaking you down. And that’s where you come in.
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And if you all are willing to join me, I guarantee you not only will we stop these interest rates from going up, but we’re going to remind the rest of the world just why it is that America is the greatest nation on Earth.
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Now is not the time to double the interest rates on our student loans. Now is not the time to double interest rates. Now is the time to double down on starting investments that build a strong and secure middle class. Now is the time to double down on building an America that’s built to last.
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Now, I know that those of you who are about to graduate -- you're pretty cheerful about that, huh? I know those of you who are about to graduate sometimes are wondering what’s in store for your future. Because not even four years ago, just as the global economy was about to enter into freefall, you were still trying to find your way around campus. And today, our economy is recovering, but it's not yet fully recovered from the worst financial crisis and economic crisis that we've experienced since the Great Depression.
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When I was over at The Sink I was talking to three business majors, and they all had these business ideas. But it's tougher if you've got all this loan that you're already thinking about the minute you get out of school. Maybe you’ve got to start a family a little bit later. It takes you a longer time to save for retirement. And when a big chunk of every paycheck goes towards loan debt, that’s not just tough on you. It's not just tough on your families. It’s painful for the whole economy because that's money that could be going into the economy and could be going into new businesses and could be helping businesses grow.
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All right. Now, five years ago, Congress cut the rates on federal student loans in half. That’s five years ago. Not the current Congress, Congress five years ago. On July 1st of this year, two months from now, that rate cut expires. I want everybody to understand this. Interest rates on those loans will double overnight, starting on July 1st, if Congress does not act. And for each year that Congress does not act, the average student with these loans is going to rack up an additional $1,000 in debt. So this is money out of your pocket. It’s basically a $1,000 tax hike for more than 7 million students across America -- almost 170,000 students here in Colorado alone.
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Do we want to keep giving taxpayer giveaways to big oil? Or do we want to invest in clean energy and do we want to make sure that we're rebuilding this country? And make sure that we can keep interest rates on millions of students affordable? We need to be investing in the things that build America over the long term. Things like education and science, a caring for our veterans, and a strong military. And we can’t have it both ways. We've got to make choices.
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In America, we admire success. We aspire to it. I want everybody here to do great, be rich, go out and start a business. That's wonderful. We work and we hustle, you study hard to get your degree -- because you believe in success and individual initiative. But America is not just about a few people doing well. America is about everybody having the chance to do well. That’s what the American Dream is all about.
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I asked students at North Carolina to do this earlier today and they got it trending worldwide for a while. So let’s see if you can do better -- because we’ve got to keep the heat on. Your voice matters. You’ve got to stand up. You’ve got to be heard. You’ve got to be counted. You’ve got to tell them now is not the time to double your interest rates on student loans. Now is the time to double down on the investments in a strong and a secure middle class, and double down on an America that’s built to last.
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I know that those of you who are about to graduate are wondering what’s in store for your future -- because not even four years ago, just as the global economy was about to enter into freefall, you were still trying to find your way around campus, and now, four years later, you're looking at what it means when you leave this campus.
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But what I want all of you to know is that the degree you earn from Iowa will be the best tool you have to achieve that basic American promise -- the idea that if you work hard, if you give it your all, if you're responsible, then you can do well enough to raise a family and own a home, send your own kids to college, put a little away for retirement. It’s the idea that each generation is going to have a little more opportunity than the last. That’s at the heart of the American Dream.
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Number three, we’ve got to give more young people the chance to earn their way through college by doubling the number of work/study jobs over the next five years. That’s an achievable goal. And then most immediately -- and this is where I really need you guys -- Congress needs to act right now to prevent interest rates on federal student loans from shooting up and shaking you down. That’s where you come in.
You see, five years ago, Congress cut the rates on federal student loans in half. That was a good thing to do. But on July 1st of this year, which means about two months from now, that rate cut will expire. And if it expires, interest rates on these loans will double overnight. And for each year that Congress doesn’t act, the average student with these loans will rack up an additional $1,000 in debt. That’s basically a $1,000 tax hike on more than 7 million students around America, including 250,000 students right here in Iowa.
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We need to make sure everybody pays their fair share. How can we continue to subsidize an oil industry that's making record profits instead of investing in things like clean energy that will help shape our future? Do we want to jack up interest rates on millions of students? Or do we want to keep investing in the things that help us in the long term -- things like education and science, and a strong military, and care for our veterans? Because we can’t have it both ways. We can't do all things on the cheap.
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And one thing I want to be clear about -- because when I talk like this, sometimes the other side, they get all hot and bothered, and they say, he’s getting -- he’s engaging in class warfare. This isn’t about class warfare. We want every American to succeed. That's the point. I want all of you to be rich. I want all of you to be successful. We aspire to it. That's what Americans do. We work and we hustle, and we study, and we take risks -- to succeed. And we don't expect a handout. But we also understand we’re in this thing together, and America is not about just a few people doing well, it’s about everybody having a chance to do well. That’s what the American Dream is all about.
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Change is extending more than 16,000 new loans to women-owned businesses, cutting small business taxes more than 18 -- 17 times, so that more women have the power to create new jobs and opportunity.
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But obviously, we’ve gone through three and a half of the toughest years that this country has seen in my lifetime and most of yours. The worst financial crisis since the Great Depression. The worst economic crisis worldwide since the 1930s. The month I took office we lost 750,000 jobs. The U.S. auto industry, the iconic industry that had helped to create our middle class, was on the verge of liquidation -- at least two of the three of the Big Three auto firms.
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Soon, insurance companies will no longer be able to deny coverage based on preexisting conditions like breast cancer, or charge women more just because they’re women. And this year, women will receive new access to recommended preventive care like domestic violence screening and contraception at no additional cost. That’s going to be happening.
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Of course, that’s exactly what the other side has planned. And they make no secret about it. They want to go back to the days when Wall Street played by its own rules. They want to go back to the days when insurance companies could deny coverage or jack up premiums without reason. A lot of them seem like they just want to turn back the clock to the ‘50s, or the ‘40s, or the ‘30s, or maybe further back than that, and close doors of opportunity that we thought we kicked open a long time ago -- doors of opportunity to people who haven’t made it quite yet.
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I want to thank Command Sergeant Major Edd Watson and his beautiful wife, Sharon. I want to thank someone who’s made it her life’s mission to stand up for the financial security of you and your families, somebody who knows a little bit about military families and military service. And actually, this is a homecoming for her because she spent over three years when they were posted down here -- Holly Petraeus is in the house. I want you guys to give her a big round of applause.
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That misreads America. That's not what America is about. The American story has never been about what we can do on our own. It’s about what we do together. In the construction industry, nobody gets very far by themselves. I'm the first to admit -- I’ve got to be careful here because I just barely can hammer a -- nail into the wall, and my wife is not impressed with my skills when it comes to fixing up the house. Right now, fortunately, I'm in a rental, so -- I don't end up having to do a lot of work.
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Second, our joint vision commits us to deepening our trade and investment. We’re already among each other’s top trading partners, and our exports to Japan and Japanese companies here in the U.S. support more than 1 million American jobs. But there’s more we can do, especially as we work to double U.S. exports. So I appreciate the Prime Minister updating me on his reform efforts in Japan, including liberalizing trade and playing a leading role in Asia Pacific’s economy. We instructed our teams to continue our consultation regarding Japan’s interest in joining the Trans-Pacific Partnership, which would benefit both our economies and the region. And we agreed to deepen our cooperation on nuclear safety, clean energy and cyber security to enhance our economic competitiveness.
Third, our joint vision lays out the future we seek in the Asia Pacific -- a region where international rules and norms are upheld, where nations contribute to regional security, where commerce and freedom of navigation is not impeded and where disputes are resolved peacefully. As such, we continue our close consultations on the provocative actions of North Korea, which are a sign of weakness and not strength, and only serve to deepen Pyongyang’s isolation. And we discussed the changes underway in Burma and how our two nations can both reward progress there while encouraging more reforms that improve the lives of the Burmese people.
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Well, first of all, I think Cory Booker is an outstanding mayor. He is doing great work in Newark and obviously helping to turn that city around. And I think it’s important to recognize that this issue is not a “distraction.” This is part of the debate that we’re going to be having in this election campaign about how do we create an economy where everybody from top to bottom, folks on Wall Street and folks on Main Street, have a shot at success and if they’re working hard and they’re acting responsibly, that they’re able to live out the American Dream.
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Q Thank you, . I’d like to take you back to not this summit, but the one you hosted at Camp David a couple of days ago and whether you feel that you can assure investors there are contingency plans in place to cope if Greece leaves the euro to prevent a Lehman-like shock to the U.S. and the global economy?
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I think we all understand, though, what’s at stake. What happens in Greece has an impact here in the United States. Businesses are more hesitant to invest if they see a lot of uncertainty looming across the Atlantic because they're not sure whether that's going to mean a further global slowdown. And we’re already seeing very slow growth rates and in fact contraction in a lot of countries in Europe. So we had an extensive discussion about how do we strengthen the European project generally in a way that does not harm world economic growth, but instead moves it forward.
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We’ve got to make sure that banks are recapitalized in Europe so that investors have confidence. And we’ve got to make sure that there is a growth strategy to go alongside the need for fiscal discipline, as well as a monetary policy that is promoting the capacity of countries like a Spain or an Italy that have put in place some very tough targets and some very tough policies, to also offer their constituencies a prospect for the economy improving, job growth increasing, incomes expanding even if it may take a little bit of time.
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The ideas that [Republicans are] putting forward have been tried. We tried them between 2000 and 2008, and it resulted in the most sluggish job growth that we've ever seen.
There were those who said we should let Detroit go bankrupt, but we met -- we made a bet on the American worker -- on the ingenuity of American companies -- and now the auto industry is back on top of the world and manufacturing is starting to invest in America again. We’ve seen American manufacturing adding jobs for the first time since the 1990s.
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Business got back to basics. On the way over, the Governor and a couple of the Congressmen and I were talking about small businesses. And all those folks who were taking a chance, maybe they failed the first time, maybe even the second time, and then during this recession they were doing everything they had -- maybe sometimes not taking any money out of the business themselves so they could keep their workers who depended on those jobs, on the job. And it’s because of folks like that that we’ve created over 4 million jobs in the last 26 months -- more than 1 million of those in the last six months alone.
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There is nothing new about these ideas. It’s the same old stuff they've been peddling for years. Though, Bill Clinton pointed this out a few weeks ago -- this time their agenda is on steroids. They want even bigger tax cuts for the wealthiest Americans. They want even deeper cuts to things like education and Medicare, and research and technology. They want to give banks and insurance companies even more power to do as they please.
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So that’s what’s at stake. On issue after issue, we can’t afford to spend the next four years going backwards. We don’t need to refight the battles over Wall Street reform -- we just saw how much it’s needed. We don’t need to refight the battle over health care reform -- Tami told you why it’s needed. We’ve got 2.5 million young people who are on their parent's plan right now because of that bill -- have health insurance who wouldn’t otherwise have it. Millions of seniors who are seeing their prescription drug prices lower because it was the right thing to do. We’re not going to go back to days when the insurance companies had unchecked power to cancel your policy, or deny your coverage, or charge women differently than men. We’re not going back there.
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Now, are we satisfied? Of course not. We've still got friends out there, and family who are looking for work. All across America there are homes that are still underwater, too many small businesses still struggling to get financing. States are still laying off teachers and first responders.
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But while there's certain economic developments we can't control, there are a bunch of things that we can control. There are plenty of steps that we can take right now -- steps that we must take right now -- to speed up this recovery and to create jobs, and to restore some of the financial security that a lot of families have lost. It's within our control to do all of that right now. But here's the thing -- (applause.) It's true, we can make that difference.
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And Newton knows something about that -- because Newton lost manufacturing. Newton lost Maytag. A lot of the trends that we had seen even before the financial crisis hit, hit Newton first. And so when you hear somebody say we should cut more taxes, especially for the wealthiest Americans, well, Newton, you've been there and you've done that. We did that -- 2000, 2001, 2003. When you hear people say that we should cut back more on the rules we put in place for banks and financial institutions to avoid another taxpayer bailout -- well, we tried that. When people say that we should just wait until the housing market hits bottom and hope that it comes back, hope for the best -- well, that's not an answer for people. That doesn't make sense.
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We've tried at lot of these ideas for nearly a decade. It did not work. We saw manufacturing moving offshore. We saw a few people do very well, but too many families struggling just to get by -- all before the financial crisis hit. And the financial crisis made it worse. So we can't go backwards. We've got to move forward. We've got to build an economy where hard work and responsibility pay off, where you can find a good job and own your own home, maybe start your own businesses and give your kids a chance for a better future. That's the American way. That's who we are.
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Third thing, instead of just talking about job creators -- you always hear -- every member of Congress has said, we’ve got to help the job creators. Okay, let’s help them. Congress should help small business owners who create most of the new jobs in America -- small business owners. So what we want to do is give them a tax break for hiring more workers and for paying them higher wages. Give them an incentive to say, you know what, if on the margins maybe I’m thinking about hiring that extra person, if I get a tax break it makes that person a little bit cheaper to hire, and that can put more of our neighbors and friends back to work. So that’s a common-sense idea.
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And it’s been tough. But it turns out the American people were tougher. We don't quit. We don't give up. We keep on going. Together, we fought back. We fought our way back. When some said, you know what, we should just let Detroit go bankrupt, we made a bet on American workers and American innovators and American companies, and today, the auto industry is back on top of the world.
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Manufacturers are starting to invest in America again, adding jobs for the first time consistently since the '90s. Businesses got back to basics. Small business owners, entrepreneurs -- they hung on, made it work, kept on their employees where they could -- created over 4 million jobs in the last 26 months, more than 1 million in the last 6 months alone.
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Of course, the fact is there’s nothing new about these ideas. They’ve been peddling this stuff for years. Although, as Bill Clinton said a few weeks ago, this time their agenda is on steroids. But it’s not new. They want bigger tax cuts for the wealthiest Americans. They want even deeper cuts for things like education and Medicare, and research and technology. They want to give banks and insurance companies even more power to do as they please, and gut and strip out regulations that help protect consumers.
But that’s not new. That was tried, remember? The last guy did all this. Governor Romney, well, he is saying, well, my 25 years in private sector gives me a special understanding of how our economy works. Well, if that’s true, why is he peddling the same bad ideas that brought our economy to the brink of collapse? Most good business people I know, if something doesn’t work, they do something different. So he must either think that there’s going to be a different result, or he's hoping you don’t remember what happened the last time we tried it his way.
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And that's what's at stake. On issue after issue, these guys want to go backwards. America doesn’t want to spend the next four years re-fighting the battles we just had over Wall Street reform. We're just seeing now how necessary it still is to just provide some basic rules for the road. We don't want to re-fight the battles of health care. We've got 2.5 million young people on their parent's health insurance plan. That was the right thing to do. Millions of seniors saving on their prescription drugs -- that was the right thing to do. We're not going to go back to a time when insurance companies could just drop your coverage, or cancel your policy, or charge women more than men. We’re not going back to that.
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And we're not going to enshrine a system where elections are determined because you can write a $10 million check, drowning out the voices of other citizens. We're not going to give up on the notion that it makes no sense for us to deny citizenship to responsible young people who want to start a business here or work here, to contribute to this country, to serve their country -- just because their parents might have been undocumented. That doesn’t make sense. This country is best when we harness the God-given talents of every individual and we hear every voice and we come together as one American family, striving for the same American Dream.
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So we're going to have a lot of work to do. We've gone through some tough times. The economy has been tough. We still have friends and neighbors who are out of work. We still have too many folks whose home values have dropped, small businesses that are still struggling. So we're going to have to keep on moving. We've got to push forward. We can't go backwards.
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And we came together in 2008 because you could tell that our country -- or at least the leadership in Washington -- had strayed away from these basic values. We had a record surplus that had been squandered on tax cuts for folks who didn’t need them and weren’t even asking for them. Two wars had been waged on a credit card. Wall Street speculators were reaching huge profits, making bets with other people’s money, but it was destabilizing our financial system. Manufacturing was moving offshore. A shrinking number of Americans were doing fantastically well, but a whole lot of people were struggling with falling incomes and rising costs and the slowest job growth in half a century.
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So when some said we should just let Detroit go bankrupt, we put our money on American workers and the ingenuity of American companies. And today, plants are adding new workers and new shifts, and the American auto industry is firing on all cylinders. Our manufacturers started investing in America again -- first time we consistently added manufacturing jobs since the 1990s.
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I’m running to make sure the next generation of high-tech innovation and manufacturing takes root in places like Des Moines and Newton and Waterloo. I want to stop rewarding businesses that ship jobs and profits overseas. I want to reward companies that are creating jobs and bringing jobs back here to the United States of America. That’s the choice in this election.
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Now, listen, the debt and the deficit are serious problems and it is true that the depth of the recession added to the debt. A lot more folks were looking for unemployment insurance. A lot fewer folks were paying taxes because they weren't making money, so that added to the debt. Our efforts to prevent it from becoming a depression -- helping the auto industry, making sure that not as many teachers were laid off -- all those things added to the debt.
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On issue after issue, we can’t afford to spend the next four years just going backwards. We don’t need to re-fight the battle we just had over Wall Street reform. That was the right thing to do. We’ve seen how important it is. We don’t need to re-fight the battle we just had over health care reform -- having 2.5 million young people stay on their parent's health insurance -- that was the right thing to do. Cutting prescription drug costs for seniors -- right thing to do. We're not going to go back to the days when insurance companies had unchecked power to cancel your policies, or deny you coverage, or charge women differently from men. We’re not going back to that.
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And it’s time to stop denying citizenship to responsible young people just because they’re the children of undocumented immigrants. Look, you know what, this country is at its best when we harness the God-given talents of every individual, when we hear every voice, when we come together as one American family all striving for the same American Dream. That’s what we’re fighting for. That’s why I’m running for a second term. That’s why I need your help.
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Now we’ve got to do more. Obviously, the world economy is still in a delicate place because of what’s going on in Europe and the fact that some of the emerging countries have been slowing down. It is absolutely critical for us to make sure that we are full speed ahead.
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Number three, Congress still has the opportunity to do more to help small business owners who create most of the new jobs in America. So we want to give them a tax break for hiring more workers and providing those workers higher wages.
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Over the past few years, I’ve met with a lot of business leaders and a lot of workers across America, from companies like Boeing to Dow Chemical to smaller companies that are also interested in accessing foreign markets. And they’ve told me how critical support from the Ex-Im Bank has been in competing more effectively in the global marketplace. As the head of the bank, we owe our thanks to Fred Hochberg, who is here on stage, for doing such an outstanding job.
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Number two, Congress should give every responsible homeowner the opportunity to save an average of $3,000 a year by refinancing their mortgage. We're starting to see a little bit of stabilizing in some of the housing markets around the country, but that continues to be a significant drag on our economy. But when families are able to take advantage of these historically low rates, it makes a difference. It puts money in their pockets or it may help them rebuild some of their equity. It gives them more confidence and the housing market stabilizes further.
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We've done everything that we can do administratively to help some portion of homeowners around the country refinance. But every responsible homeowner in America should have a chance to save money. That's not just good, by the way, for the housing industry, that's good for all businesses, because it means consumers are going to be out there with a little extra money in their pockets.
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America has come through some tough times together, and it’s going to take more time than any of us would like to get to a place where all of us have fully recovered from the worst recession in our lives. There will continue to be hurdles and there will continue to be some headwinds that we can’t fully control, but there are plenty of things we can control. And there are plenty of solutions within our reach. There are steps that we can take right now to speed up this recovery, to help create jobs, to restore some of the financial security that families have lost. It’s within our control to do the right thing and do it now.
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That’s certainly been true of President Bush. The months before I took the oath of office were a chaotic time. We knew our economy was in trouble, our fellow Americans were in pain, but we wouldn’t know until later just how breathtaking the financial crisis had been. And still, over those two and a half months -- in the midst of that crisis -- President Bush, his Cabinet, his staff, many of you who are here today, went out of your ways -- George, you went out of your way -- to make sure that the transition to a new administration was as seamless as possible.
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So the reason you're all here, the reason all these fine-looking young people behind me are here is that in just over a week the interest rates on federal student loans are scheduled to double. I’ve been talking about this now for what -- a month and a half, two months, three months, five months -- I’ve lost track. We’ve been talking about it for a long time. If Congress does not get this done in a week, the average student with federal student loans will rack up an additional $1,000 in debt over the coming year. If Congress fails to act, more than 7 million students will suddenly be hit with the equivalent of a $1,000 tax hike. And that’s not something that you can afford right now.
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This is all about the economy. This is all about whether or not we are going to have the best-trained, best-educated workforce in the world. That improves our economy. And higher education cannot be a luxury reserved just for a privileged few. It’s an economic necessity for every family, and every family should be able to afford it.
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President Eisenhower, a Republican, he launched the Interstate Highway System and a new generation of scientific research. He understood that for companies to grow and hire, they need access to the best transportation, and the fastest communication, the most cutting-edge innovation.
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My plan will stop giving tax breaks to businesses that ship jobs and factories overseas, and start rewarding companies that create jobs and manufacturing right here in the United States of America.
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And that may be their plan to win an election, but it’s sure not a plan to create jobs. It’s not a plan to grow the economy. It’s not a plan to pay down the debt. It’s not a plan to restore the middle class and restore the American Dream.
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In this country, we believe that if you want to take a risk on a new idea, you should have the chance to succeed. And you shouldn’t have to have wealthy parents in order to be successful. Latino-owned businesses have been the fastest-growing small businesses, and we’ve cut their taxes 18 times. We’ve expanded new loans and new credit so they can grow and they can hire. That’s the vision we believe in.
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In America, we believe you shouldn’t go broke because you get sick. Hardworking people out there -- sometimes two jobs, three jobs -- still don’t have health insurance. If you did have health insurance, insurance companies were able to discriminate against certain patients. That was wrong. It was wrong to let insurance companies just jack up premiums for no reason, and to have millions of working Americans uninsured -- with the Latino community having the highest rate of uninsured of any community in the country.
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We need to give families in hard-hit housing markets like Florida and Nevada the chance to refinance and save $3,000 a year on their mortgage. That's good for those families. It’s good for the housing market. It’s good for the surrounding community. There's no reason why Congress hasn’t already done it.
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Instead of just talking a big game about "job creators," we should give small business owners a tax break for hiring more workers or for paying higher wages. Instead of rewarding companies that ship jobs overseas, we should take that money and use it to cover moving expenses for companies who are bringing jobs back to America.
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In this country, prosperity has never come from the top down -- it comes from a strong and growing middle class, and creating ladders of opportunity for all those who are striving to get into the middle class. It comes from successful, thriving small businesses that over time grow into medium-size and then large businesses.
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And the reason is, in this country, in America, prosperity has never come from the top down -- it comes from a strong and growing middle class, and all those people who are striving and working to get into the middle class. It comes from successful, thriving small businesses that grow into medium-sized businesses, and then large businesses.
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Now, listen, there’s no mystery about where the other side will take us if they win the election. I mean, their economic plan has been voted on in Congress. Governor Romney has it right there on his website. So, look, first, they promise to roll back all kinds of regulations on banks and polluters and insurance companies and oil companies.
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But if you believe we need a better plan -- if you believe we need a middle-class plan -- that grows our economy and shrinks our deficit -- then we need to win this election. We need to move this country forward.
Despite what you’ll hear from the other side, my plan isn’t based on some belief that government has the answer to all our problems. Over the last three years, I’ve cut taxes for the typical working family by $3,600. I’ve cut taxes for small businesses 18 times. I want a government that is leaner and smarter, one that's designed for the 21st century, more responsive to the American people.
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So this is about choices. I don’t believe that giving millionaires and billionaires a $250,000 tax cut is more valuable to our future than hiring transformative teachers, or providing financial aid to kids who need it to go to college. I don’t believe that kind tax cut is more likely to create jobs than providing loans to new entrepreneurs, or tax credits to small businesses who hire veterans. I don’t think it’s more likely to spur economic growth than our investments in clean energy and medical research, in building new roads and bridges and expanding our ports and our runways.
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You can decide, you choose whether to re-fight the battles we just had over financial reform and health care reform. Or you can decide that ending taxpayer bailouts of Wall Street banks was the right thing to do, and that allowing 3 million young people to stay on their parents' health insurance is the right thing to do, and that preventing insurance companies from discriminating against people with preexisting conditions is the right thing to do. You can decide.
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And in answering that question, we've got two fundamentally different visions -- one vision that essentially can be summed up as get rid of all regulations and cut taxes for another $5 trillion, a top-down approach to economic growth.
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I ran for this office because for more than a decade, that basic bargain, that profound American Dream had been slipping away from too many people. Before I took office, the worst economic crisis of our lifetime made it even worse.
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And, look, their plan is pretty simple. It’s been voted on in Congress. It’s right there on Governor Romney’s website. First of all, they promise to roll back all kinds of regulation on banks and polluters and insurance companies and oil companies.
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But what we also understand is, is that there are way too many people out there who are still struggling, too many people whose homes are underwater, too many small businesses that are still finding it hard to get financing and keep their doors open.
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I believe they’re wrong. I believe their policies were tested, and they failed. And that -- my belief is not just based on some knee-jerk partisan reaction. It’s based on the fact that we tried it. And you look at our economic history. In this country, prosperity has never come from the top down. It comes from a strong and growing middle class. It comes from successful, thriving small businesses.
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Over the last three years, I cut taxes for the typical working family by $3,600. I cut taxes for small businesses 18 times. I don’t believe every regulation is smart, or that every tax dollar is spent wisely. I don’t believe we should be in the business of helping people who refuse to help themselves. But let me tell you what I do believe.
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This is about choices. I don’t believe that giving millionaires and billionaires a $250,000 tax cut is going to do more for our future than hiring transformative teachers, or providing financial aid to the children of middle-class families. I don’t believe a poorly designed tax cut like that is more likely to create jobs than providing loans to new entrepreneurs, or tax credits to small businesses who hire veterans. I don’t think it’s more likely to spur economic growth than investments in clean energy and medical research, and new roads and bridges and runways.
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And because of the incredible resilience and the incredible hard work, the toughness of the American people, we’ve begun to see progress -- created over 4 million jobs over the last three-and-a-half years -- 800,000 in the last few months alone. When some were saying let’s go ahead and let Detroit go bankrupt, we bet on the American worker and American industries. And today the U.S. auto industry is back on top and getting stronger.
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And let me be clear. We all believe in the free market. We all believe that risk-takers and entrepreneurs need to be rewarded. It's that dynamism that built this country. But we also believe in shared prosperity. I want to close the outsourcing loophole in our tax code. I want to give tax breaks to companies who create jobs and manufacturing right here in the United States of America.
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But I believe their policies have been tested, and their policies have failed. And that’s because in this country, prosperity hasn't come from the top down. It's come from a strong and growing middle class. It's come from people striving to get into that middle class. It's come from successful, thriving small businesses that turned into medium-sized businesses and large businesses. It comes from consumers who are seeing enough income and wage increases that they can afford to buy great products and services from businesses -- and the entire economy grows.
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There's nothing radical about that vision. That’s the vision that built this country. It was part of what used to be a bipartisan consensus. We don’t expect government to solve all our problems. This notion that somehow there's been some heavy tilt to the left on the part of the Democratic Party -- over the last three years, I cut taxes for the typical working family by $3,600. I cut taxes for small businesses 18 times, eliminated billions of dollars in regulations that didn’t make sense and weren't making people healthier or safer.
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But in some ways, this election is more important than 2008. In some ways, the stakes are higher. Because back in 2008, there was some overlap between Democrats and Republicans on some important issues. The nominee from the other party believed in climate change, believed in campaign finance reform, believed in immigration reform. And what we’ve seen in the face of probably the worst financial crisis and economic crisis of our lifetimes is that the Republican Party has moved in a fundamentally different direction, so that on every issue we have fundamental choices that are at stake that will determine not just how we do tomorrow or the next day, but for the next 10 years or the next 20 years.
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And it was papered over for a while through debt and home equity loans and credit cards, but that was a house of cards that all came tumbling down. And so, even as we work on the immediate task of putting people back to work and getting the economy growing faster, we've got this underlying challenge that we have to meet. And that is, how do we get back to an economy that is built to last, and where everybody has got a fair shot and everybody is doing their fair share and everybody is playing by the same set of rules?
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And we believe in creating a great infrastructure, so businesses can move people and products and services seamlessly throughout our global economy. And we believe in a tax code that is fair and balanced, in which success is rewarded, but in which we also are paying for those investments that allow us to pass on a great country to the next generation.
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And we believe in American manufacturing -- not because manufacturing is going to be as central to today's economy as it was back in the 1950s, but when we make things and produce things and sell things around the world, there is a basic strength to our economy that ripples everywhere, and gives more and more the chance to get ahead, just as the auto industry did for two or three generations, which is exactly why we had to intercede to make sure that they succeeded.
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And I understand it's a theory to win an election. It's sure not a plan to create jobs. It's not a plan to grow our economy. It's not a plan to restore the American Dream.
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Now, that's not a recipe for economic growth. That's not going to make us stronger. That's not going to make our young people more educated. It's not going to make us more competitive in this global economy.
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And the reason this is relevant is because this is part of their overall economic vision, an overall economic plan that he and the Republicans in Congress share and they will implement if they are elected. And it’s there for all to see it -- they put it on the table. It’s been voted on in Congress. It’s right on Governor Romney’s website. They’re going to rollback all kinds of regulations on banks and polluters and insurance companies and oil companies. That’s part one of the plan.
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Listen, listen, Miami, we do not expect government to solve all our problems. This notion that somehow all we believe in are government solutions -- look at the record. Over the last three years, I cut taxes for the typical working family by $3,600. Cut taxes for small businesses 18 times. Eliminated billions of dollars of regulations that don’t make sense -- aren’t making people safer or healthier. I don’t believe we should be in the business of helping people who refuse to help themselves. I believe in individual responsibility.
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You can decide whether we should roll back Wall Street regulations that we put in place to prevent taxpayer bailouts and to protect consumers. You can decide whether it makes sense, as Mr. Romney wants to do, to roll back the reforms that we put in place that prevent insurance companies from discriminating against people who are sick.
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And so, over the last three and a half years, that journey that we began has been tough sometimes. We've had a steep mountain to climb. But slowly and surely, the American people have proved once again that they are tougher than tough times. There were folks who said, let's let Detroit go bankrupt. We said, let's invest in American workers and American businesses -- and now the American auto industry is back on top.
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So let me break this down just a little bit more specifically, just because I want everybody to understand. Let’s look for a moment at Mr. Romney’s -- the specifics of his plan. I already indicated to you he wants to roll back regulations for polluters and for insurance companies and for the big banks, and he wants to get rid of the Wall Street reform that we did to make sure that we don’t have any more taxpayer bailouts. All right, so that’s one big part of his plan. Then he’s got this plan to cut taxes by another $5 trillion. All right? So what this would mean would be the average millionaire would see their taxes go down by 25 percent.
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Well, what Mr. Romney says, first of all, is we'll cut a trillion dollars out of that portion of the federal budget that finances everything from education to Head Start, to health care to environmental protection, to consumer protection -- all the things we think of -- food safety -- you name it, a trillion dollars gets cut out of that -- which means that a lot of people suddenly will not have the protections they were counting on. A lot of folks around the country won't be getting services that we think are part of what makes America great.
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And second, if you ask insurance companies to cover people with preexisting conditions, but don’t require people who can afford it to buy their own insurance, some folks might wait until they’re sick to buy the care they need -- which would also drive up everybody else’s premiums.
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Old-school liberals saw a problem and thought a government-run program was the answer. Obamacare is the fulfillment of their dreams. Federal bureaucrats will tell all Americans what they have to have in their health insurance policies. And an unelected board will tell seniors what treatments Medicare will cover.
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They believe that if we roll back regulations that we put in place on banks and insurance companies and oil companies, all meant to protect our people and our economy, that somehow everybody is going to be better off.
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When the American auto industry was on the brink of collapse and more than one million jobs were on the line, Governor Romney said we should "let Detroit go bankrupt."
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I refused to turn my back on a great American industry and great American workers. I bet on American workers. I bet on American manufacturing. And three years later, the American auto industry has come roaring back. That's what this election is about.
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And we understood that turning that around was not going to be easy. We knew it would take more than one year or one term or maybe even one President. Now, what we didn't know was that we were about to get hit with the worst economic crisis in our lifetimes. And that crisis has put us through some really tough times -- here in Iowa and all across the country. It robbed millions of our fellow Americans their jobs and their homes and their savings. And it made the American Dream seem even further out of reach for too many hardworking people.
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Because what’s happening in the auto industry can happen in other industries, and I’m running to make sure it does. I want hi-tech manufacturing to take root in places like Cedar Rapids and Newton and Des Moines. I want goods stamped with "Made In America" selling all around the world. I want to stop giving tax breaks to companies that ship jobs and factories overseas, and start rewarding companies that create jobs right here in the United States of America.
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Governor Romney has experience owning companies that were called "pioneers" in the business of outsourcing. My experience has been working with outstanding members of labor and great managers to save the American auto industry. And as long as I’m President, I will keep fighting to make sure jobs are located here in the United States of America.
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Now, the good news is there are folks in Congress trying to do the right thing. Last month, Democrats in the Senate put forward a plan that would have kept these rates in place without adding a dime to the deficit. Unfortunately, Senate Republicans got together and blocked it. Over in the House, the Republicans said they’d keep these rates down only if we agreed to cut things like preventive health care for women, which obviously wouldn’t fix the problem, but would create a new problem.
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That’s the idea of America. It doesn’t matter what you look like. It doesn’t matter where you come from. It doesn’t matter what your last name is. You can live out the American Dream. That’s what binds us all together.
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On almost every issue, you've got the same kind of choice. When the auto industry was about to go under, a million jobs lost, and my opponent said, "let's let Detroit go bankrupt," what did I say? I said --
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I said I'm betting on America's workers. I’m betting on American industry. And guess what? Three years later, GM is number one again and the American auto industry has come roaring back.
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And the point was that your vacation didn’t have to be fancy. It just gave you a sense of how you could spend time with each other. That was part of that American Dream. And then the notion that you could retire with dignity and respect after a lifetime of work.
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Now, let me say this. If you believe that the recipe for economic growth is to give the top 2 percent additional tax breaks, then by all means you should send those folks to Washington.
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Now, that may be a plan to win an election, but it's not a plan to put people back to work. It's not a plan to reduce our deficit. It's not a plan to grow the middle class. It's not a plan to revive the American Dream.
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I love you back. But I just want to point out that we tried their theory for almost 10 years, and here’s what it got us: We got the slowest job growth in decades. We got deficits as far as the eye can see. Your incomes and your wages didn’t go up. And it culminated in a crisis because there weren’t enough regulations on Wall Street and they could make reckless bets with other people’s money that resulted in this financial crisis, and you had to foot the bill. So that’s where their theory turned out.
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Now, this is just a small example of the difference between myself and Mr. Romney, between myself and some of the Republicans who are running Congress. And look, Virginia, I want to repeat -- this is a choice. If you think their way of doing things is a recipe for economic growth and helping the middle class, then you should vote for them.
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So what I want to do is, I want to let every single person refinance their homes and save about $3,000 a year because you’ll spend that $3,000 on some of these stores right here in downtown. You’ll help small businesses and large businesses grow because they’ll have more customers. It will be good for you and it will be good for the economy. And that’s why I’m running for a second term as President -- because I want to help America’s homeowners.
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And then just as the campaign was being completed and just as we were making some history, what we realized was we’re going through the worst financial crisis and economic crisis since the Great Depression. We knew that turning this thing around would not be easy. We knew it was going to take more than one year or one term or maybe even one President.
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And this crisis has been tough on a lot of folks and a lot of families. It robbed millions of hardworking Americans their livelihoods, their homes, their savings. It pushed the American Dream, that basic bargain even further out of reach for too many people. But you know what, that crisis didn’t change who we are or what we believed in. It didn’t change our character as a country. It hasn’t changed why we came together in 2008.
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I want to bring down the deficit in a responsible, balanced way. I’ve already put forward a plan -- $4 trillion in deficit reduction, spending cuts for things that we don’t need, strengthen Medicare and our health care system so that we get a better bang for our buck -- and asking the wealthiest to pay a little bit more. And you know what, when you talk to folks around the country, successful Americans, they want to do a little more. If it’s done right, they want to contribute to making America stronger.
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On almost every issue in this race, the choice couldn’t be more stark. When America was seeing its auto industry on the brink of collapse, my opponent said, let’s "let Detroit go bankrupt." That would have cost about a million jobs. I said I’m betting on American workers. I’m betting on American ingenuity. And you know what, GM is the number-one automaker again because we made that bet.
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It turns out that that his business record was starting a company that's been investing in what were called "pioneers" of outsourcing. He wants to keep giving tax breaks to companies that ship jobs overseas. I want to end those tax breaks. I want to give tax breaks to companies that are investing here in Virginia, investing in American workers, investing in advanced American manufacturing so we can sell our goods around the world stamped with three proud words: Made in America. That's why I’m running.
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But that’s still not enough. Still haven’t gotten to the $5 trillion yet. So then they’ll also have to raise taxes on the middle class by taking away tax benefits for everything from health care to college to retirement to home ownership, and this could cost some families thousands of dollars.
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And so that's what brought us together. The campaign in 2008 was not about a single candidate. It wasn’t about me. It was about us -- and our desire to make sure that the American Dream continues for the next generation and the generation after that and the generation after that.
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And that's how we were able to save an auto industry when some said let’s "let Detroit go bankrupt." We said we’re going to be on American workers and American industry. And now GM is back on top, and Ford and Chrysler are selling cars -- because we believe in that American promise. Business started getting back to basics and we’ve now created more than 4.4 million new jobs, more than 500,000 manufacturing jobs created during this time.
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Let’s take small businesses. I’ve cut small business taxes 18 times since I’ve been in office. And by the way, 97 percent of small businesses make $250,000 a year or less. So for 97 percent of small businesses, they’d also benefit if we went ahead and got that done right now.
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In America, we believe you shouldn’t go broke because you get sick. Hardworking people out there -- sometimes two jobs, three jobs -- still don’t have health insurance. If you did have health insurance, insurance companies were able to discriminate against certain patients. That was wrong. It was wrong to let insurance companies just jack up premiums for no reason, and to have millions of working Americans uninsured -- with the Latino community having the highest rate of uninsured of any community in the country.
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Mr. Romney says that undocumented workers in this country should "self-deport." My belief is that we are a nation of laws and a nation of immigrants, and I want to make sure that we get comprehensive immigration reform that gives young people who've been raised here a chance to live out their own American Dream. I don’t want to go backwards, I want to go forward.
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So let’s just take a few examples of the contrast between their approach and what I’m proposing. When the auto industry was on the brink of collapse, my opponent said, let’s let Detroit go bankrupt.
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I said, let’s bet on American workers and American ingenuity. And you know what, GM is number one again. Chrysler is selling cars again. Ford is on the move. The U.S. auto industry has come roaring back.
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And so the point is that during this campaign, during all the campaigns I've run, what I've always been moved by, what's always inspired me is that at the center of our stories is this basic American idea, this core American Dream, that says, in this country, like no other, if you are willing to work hard, you can make it if you try. If you're willing to meet your responsibilities to not only yourself and your family, but to your community and your country, you can enjoy the security of a middle-class life.
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So that’s one big part of their idea, is you cut taxes for folks at the top. Their second big idea is if you eliminate regulations on oil companies or insurance companies or credit card companies or polluters, that somehow that will free up the engine of growth. So those are basically their two -- those are the only two ideas they have. Don’t take my word for it. Go on their websites. Look at the Republican budget in the House of Representatives. That’s their basic approach. They believe that somehow all these benefits are going to trickle down if we just implement their plan.
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And what happened in the auto industry I want to see happen in manufacturing all across this country -- right here in Virginia. We’ve invested in advanced manufacturing because we want to beat out countries like Germany and China. I want the great inventions to be done here, and I want great new products created here -- which is why -- and this is another contrast -- whereas my opponent, in his private business, was investing in companies that The Washington Post calls “pioneers" of outsourcing, I believe in insourcing. I want to stop giving tax breaks to companies that are shipping jobs overseas. Let’s give those tax breaks that are investing right here in Virginia -- right here in the United States of America, hiring American workers to make American products to sell around the world. That’s why I’m running for President of the United States.
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I’m running to continue to strengthen our housing market, which has been one of the biggest drags on our economy. So I told Congress let’s create an opportunity where every American can refinance their homes and take advantage of historically low rates. It would save the average family $3,000 a year. My opponent’s plan is to let the foreclosures play themselves out and let the market hit bottom.
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Let me just say that I passed this bill because it was the right thing to do. The Supreme Court has spoken. We are implementing this law. If you’ve got health insurance the only thing that happens for you is that you’ve got more security because insurance companies can't jerk you around and use fine print to somehow restrict your care.
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No, I mean, this is on their website. Their proposal is in Congress right now. And the only way to pay for this would be to gut our investments in transportation, education, basic research in things like Alzheimer’s and cancer, voucherize the Medicare system. And they will not ask for a single dime of additional revenue from those who can afford to pay it. I think that's -- that's not a recipe for economic growth.
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So what I’ve said is, look, middle-class families, folks who are making $250,000 or less, 98 percent of Americans, you shouldn’t see your taxes go up one dime. You don't need to. Your income taxes should stay constant. And I’ve said to Congress let’s go ahead and get that done now. Let’s give 98 percent of folks certainty right now. By the way, 97 percent of small businesses earn less than $250,000, so the vast majority of people would get immediate relief.
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See, my opponent and his allies in Congress, they believe in a top-down economics. They believe that if we spend trillions of dollars on tax cuts -- mostly for the wealthy -- even if we have to pay for it by gutting education, or gutting job training programs, or gutting investments in basic research, or turning Medicare into a voucher system, or increasing middle-class taxes -- that if we do that, somehow all of you are going to benefit. That’s their idea. They also believe that if we roll back regulations on banks and insurance companies and credit card companies -- regulations that are meant to protect people and our economy -- that somehow everybody is going to be more secure. That’s their basic argument. They’ll spend a lot of time talking, but if you cut through all the stuff -- what they’re really saying is tax cuts for the wealthy, roll back regulations. That’s essentially their plan.
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You know, when the American auto industry was about to go under, and my opponent was saying, "let Detroit go bankrupt," I made a bet on American workers, on American ingenuity, and we got management and workers to sit down and work things out. And right now, GM is number one again -- and the U.S. auto industry is back on top.
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Well, let me tell you something. What can happen in the auto industry in Detroit, that can happen in manufacturing all across this country. In Richmond and in Raleigh, and in Pittsburgh and in Cleveland. Which is why I've said let's stop giving tax breaks to companies that are shipping jobs overseas, let's give tax breaks to companies that are investing right here in the United States of America, and investing in American workers, so we can make American products stamped with those three proud words: Made In America. That's how we build an economy that lasts. And that's why I'm running for a second term as President.
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I'm running because I believe we've got to keep going on the Affordable Care Act. It was the right thing to do to make sure that everybody has health care. The Supreme Court has spoken. It is the law of the land. We are going to implement it. And because we're implementing it, young people can stay on their parent's health insurance plans until they're 26 years old. And if you've got health insurance, the only thing that's going to happen is you've got more security and insurance companies can't jerk you around. And 30 million people, including those with preexisting conditions, can finally get health insurance. It was the right thing to do. We're not going backwards, we're going forwards.
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And over the next four months, the other side is going to spend more money than we've ever seen in our lifetimes on a bunch of negative ads. And they're going to try to peddle this economic theory that everybody knows we tried and didn’t work. And since they know that's probably not going to sell, really what these ads are going to do is just say, the economy isn’t where it needs to be and it's Obama's fault. That's their message. They'll use all those scary voices in the ads and -- but that's basically their message.
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Governor Romney and his allies in Congress, they believe in an economic theory that says if folks at the very top are doing really well, then that spreads to everybody else. It’s what we call top-down economics.
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Q My name is Delisha White (ph) and I and my husband, we're small business owners. And he actually has a question that he needs to answer.
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Q Okay, his question was, he is a small business owner and he wanted to know what can you do for the self-employed -- for self-employed businesses with less than 10 employees working with him.
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And so even though over the last three and a half years, our central focus has been how do we recover from this crisis, and get people back to work, and make sure that small businesses are doing well again, and that they're getting financing -- despite all those things, our goal has not just been to get back to where we were before the crisis struck, but rather to build an economy that lasts -- to build an economy that says no matter what you look like, no matter where you come from, no matter what your last name is, you can make it if you try here in America.
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So I want everybody to understand, Ohio, I’ve got a different theory. We don’t need a President who plans to ship more jobs overseas, or wants to give more tax breaks to companies that are shipping jobs overseas. I want to give tax breaks to companies that are investing right here in Ohio -- that are investing in Cincinnati, that are investing in Hamilton County. I want to give incentives to companies that are investing in you, the American people, to create American jobs, making American goods that we’re selling around the world, stamped with three proud words: Made in America.
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A couple weeks ago, I called on Congress to immediately extend these tax cuts to 98 percent of the American people. Folks making $250,000 a year or less would not see their taxes go up one single dime -- their income taxes go up one single dime. Now, I should point out, by the way, that 97 percent of small businesses also would not see their taxes go up, because typically they don't earn more than $250,000.
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That's why when the auto industry was on the brink of collapse and Governor Romney said let's "let Detroit go bankrupt," I said no. One out of eight jobs in Ohio depend on the auto industry -- a million jobs across the Midwest are at stake. I'm going to bet on American workers and American ingenuity. And now, GM is back on top and Chrysler and Ford are on the move, and the American auto industry has come roaring back.
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Now, you always hear these arguments that somehow there’s this huge contradiction between the environment and economic development, or the environment and energy production. And the fact of the matter is that there are a lot of folks right now that are engaging in hydraulic fracking who are doing it safely. The problem is, is that we haven’t established clear guidelines for how to do it safely, and informed the public so that neighbors know what’s going on, and your family, you can make sure that any industry that’s operating in your area, that they’re being responsible.
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So what we’ve said is, look, we are going to work with industry to establish best practices. We are going to invest in the basic research and science required to make sure this is done safely and in a way that protects the public health. And for responsible companies, they should be able to operate, make a profit, and we can all benefit and put people back to work. But if you’re an irresponsible company that’s not doing the right thing, we’re going to hold you to account. And that’s how we should develop this incredible resource -- which, by the way, if we do it properly, could end up changing the economics and politics globally of energy in a way that's actually very good for us, because we'll be less dependent on what happens in the Middle East and our economy will be less subject to the kinds of spikes that we saw earlier in the spring in terms of gas prices.
Thank you for the question.
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The other thing we’ve done is to say, what are the critical needs of small business? A lot of time, one of the biggest challenges is to make sure that you, as a sole proprietor, that you can get health insurance for you and your family. So when you hear about the Affordable Care Act -- Obamacare -- and I don’t mind the name because I really do care. That’s why we passed it. You should know that once we have fully implemented, you’re going to be able to buy insurance through a pool so that you can get the same good rates as a group that if you’re an employee at a big company you can get right now -- which means your premiums will go down.
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But this is an example of where there’s a contrast between myself and my opponent. As I said before, his basic tax plan is to give folks at the top a tax break. Now, we can have that debate, but what I’ve said is, in the meantime, let’s give 98 percent of individuals and 97 percent of small businesses some certainty right now by going ahead and passing a law that says your taxes won’t go up. Because if Congress doesn't act, by the way, by January 1st, everybody’s taxes here are going to go up, by an average of about $1,600 -- if Congress doesn't do anything. And so what I’ve said is if you really want to help small business right now, give 97 percent of them the certainty that their costs will not go up. And then we can have a debate about the other 2, 3 percent.
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Now, one last point I’m going to make on this small business and taxes argument -- you’ll hear Republicans say, you know what, if you tax, let’s say, somebody with a million dollars of income, you're going to be crushing the small business jobs creators. Now, first of all, I’ve just explained 97 percent of small businesses make less than $250,000 a year. But setting aside that, the way they describe small businesses, half of the Fortune 400 richest Americans in the country would qualify as a "small business." Hedge fund managers would qualify as small business, even if they were pulling in a billion dollars a year. And this is an example of what I mean when I say we just want everybody to be treated fairly.
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Housing took the biggest hit in our economy because you had this big housing bubble that collapsed, so the construction industry, the industry where your dad works, was the hardest hit of any industry and it’s the one that’s been the slowest to come back -- which is why, since September of last year, I have urged Congress to expand our efforts to rebuild roads, bridges, schools, laying broadband lines going into rural communities -- making sure that all these folks, like your father, who want to work -- these aren’t folks who are looking for a handout, they want to be on the job -- so that they have an opportunity to do work that we’re going to have to do anyway.
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It is cheaper now to do it than it will be later. Interest rates are low. Construction workers are out of work. Contractors are begging for work. They’ll come in on time, under budget. And so we could knock out a whole bunch of work that needs to get done for this country anyway, and put people back to work, which would grow the economy right now.
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But it’s not just the auto industry. Whether we’re talking about advanced manufacturing of batteries that will help us run electric cars, or wind turbines, or solar panels -- I believe in making things here in America. And I believe in inventing things here in America.
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And by the way, insurance companies can't charge women more than men now. Which reminds me, we’re not ending funding for Planned Parenthood. I think women should have control of their own health care choices just like men. We’re not going backwards.
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But we have not been deterred. As much work as we still have to do, over the last three and a half years that focus on how do we build a middle class that is strong and secure and growing, that has remained my central focus. And even as we've created 4.5 million new jobs and 500,000 jobs in manufacturing, and stabilized the financial system -- all the steps we've taken without much cooperation from the other side -- that's still been our North Star.
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And what's always helped me every single day move forward is the recognition and the belief and the understanding that although the times have been tough, the American people have been tougher -- and that for everything that happened during that financial crisis and the recession that followed, America's fundamental character did not change. People's willingness to work hard did not change. People's ability to bounce back from adversity had not changed.
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They've got one other element to it, in fairness. They also say they want to eliminate regulations on insurance companies and Wall Street banks -- regulations we put in place to protect consumers from unscrupulous mortgage practices, and that take regulations off of polluters. If we do those things along with the tax cuts, the market will be freed up, government is out of the way, and happy days are here again. That’s their theory.
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And this is not unique to the auto industry. I want advanced manufacturing locating here in San Antonio. I want us to be making things here in the United States of America, so I want to end tax breaks to companies that are shipping jobs overseas. Let’s give tax breaks to companies that are investing right here in Texas, right here in the United States of America. Let’s put American workers back to work selling goods stamped with three proud words: Made in America. That's my vision for America.
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I'm running to make sure that America has the best education system on Earth -- from pre-K all the way to post-graduate. And that means hiring new teachers, especially in math and science. And it means building on the work we've already done to make sure that student loan rates don’t double, to make sure that middle-class families are getting tuition tax credits. Now we've got to reduce the cost of college, make it more affordable to everybody. I want to expand opportunities for 2 million young people to go to community colleges so they can get trained on the jobs that businesses are hiring for right now. Because today education is not a luxury, today a higher education is an economic imperative for the 21st century. And I want to make sure that the United States of America once again has the highest percentage of college graduates, because that is going to help determine who wins the race in this global economy in the 21st century. And I want America to be number one. That’s why I'm running for President of the United States.
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And for all the misinformation out there, it’s very simple to describe what’s going to happen. If you already have health care, the only thing that you have to do is enjoy the fact that now insurance companies can't jerk you around because of the small print. You have rights. Your kids can stay on their parent's plan until they’re 26 years old. Senior citizens are seeing reductions in prescription drug costs.
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But for the last three and a half years, I have not forgotten why I got into politics, and I have not forgotten those values. And I haven't forgotten why we came together -- because we wanted to put this country back on a track where everybody had a fair shot and everybody did their fair share and everybody played by the same set of rules.
And what has kept me going, for all the progress we've made -- 4.5 million new jobs, and half a million new manufacturing jobs, and us stabilizing the financial system and averting a Great Depression, and investing in advanced manufacturing -- for all the progress that we've made, what has kept me going every single day is remembering that thing that ties us together, that binds us as a people, and understanding that no matter what we went through, no matter how many times we get knocked down, that basic character of America does not change. Who we are does not change. What we believe, the values we hold dear, the importance we place on hard work and that work being rewarded whether you are starting a small business or punching a clock -- that idea that you can make it if you try here in America, that’s what we've been fighting for.
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-- I said, first of all, it’s going to cost us a million jobs. Second of all, I believe in the American worker and I believe in American ingenuity. And so we got management and workers together, and guess what -- three and a half years later G.M. is the number-one automaker again. The auto industry is roaring back and they’re building better cars and more fuel-efficient cars than ever. That’s an example of what America can do when we work together.
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And Governor Romney, his main calling card for running for office is his business experience, and so, understandably, the American people have been asking, well, let’s find out what you’ve been doing. And if your main experience is investing in companies that are called "pioneers" of outsourcing, then that indicates that we’ve got a different vision, because I don't want to be a pioneer of outsourcing. I want to be a pioneer of insourcing. I want to stop giving tax breaks to companies that are shipping jobs overseas. I want to give tax breaks to companies that are investing right here in Austin -- investing right here in the United States of America, betting on American workers, making American products that we sell, stamped with three proud words: Made in America. That's why I’m running for President of the United States again.
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We've got tens of thousands of folks who lost their jobs in the construction industry after the housing bubble went burst. Let's put them to work rebuilding America. That’s what we do best. And by making those investments, we're not just putting people back to work right now, we're laying the foundation for economic growth for decades to come. That’s my vision for America.
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I want to expand access to community colleges for 2 million more Americans so they get trained for the jobs that people are hiring for right now. A higher education is no longer a luxury. It is an economic imperative in the 21st century. It is part of what we need to succeed in this global economy. And I'm going to fight for every young person who is willing to work hard to get an education. That's why I'm running for a second term as President of the United States.
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So on issue after issue, there is a fundamental difference. On housing, Mr. Romney says let's just let foreclosures happen and the market will bottom out. I want to make sure that every American who right now owns a home can refinance their homes at historically low rates -- put $3,000 in the pocket of every American. Not only will you spend that and create more customers for businesses, but it can also help stabilize the housing market.
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And we are not rolling back health care reform. The Supreme Court has spoken. We are moving forward. If you've got health care, the only thing that now happens to you -- you're not paying a tax -- the only thing that's happening to you is that you have more security, because insurance companies can't jerk you around. Young people can stay on their parent's plan until they're 26 years old.
Seniors are going to see lower prescription drug prices. Everybody is going to get free preventive care, including women.
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What I've said is -- I told Congress last week, let’s go ahead and say everybody who’s making $250,000 a year or less, your income taxes will not go up one dime, period. That includes 98 percent of Americans, 97 percent of small businesses. But for folks like me, we can afford to do a little bit more to make sure we are investing in America’s future.
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And there are some ingredients that we invest in as a country and as a community to make sure that the ladders of opportunity exist -- a great education system, a great transportation and infrastructure system, investments in basic science and research, investments in the kind of safety net that encourages work but also says that if you have a string of bad luck, or if somebody in your family is disabled, or when you finally, after lifelong work, retire, that you can live a life of dignity and respect, and an approach to our deficits and debt that says everybody does their fair share.
And that was my commitment even before I ran for office and that we've fought for the last three and half years -- we’ve got a long way to go. There are still way too many people who are out of work, too many homes that are still underwater across the country, too many small businesses that are
struggling.
But in addition to making sure that we didn’t fall into a Great Depression, we've tried to systematically -- whether it's the health care bill, whether it’s our approach to expanding access to college education for young people, whether it is putting in place rules and regulations to protect from the kind of chaos of Wall Street that we saw in 2007, 2008 -- everything we’ve done has been designed to fulfill that goal of making sure that we’re building a strong middle class and we’re continuing to create avenues of opportunity for those who are working hard to get into the middle class.
Now, this is going to be a close election. I don't think there's any doubt about that -- not because the other side has particularly new or interesting ideas, but because the economy is still struggling for a lot of folks. And as a consequence, your help, your support is going to be critical. But I’m optimistic about our prospects of being able to finish what we started in 2008. And the reason I’m optimistic is because what the American people showed me in 2008 is that when they determine what is true and what is right and they come together, it doesn’t matter how much money the special interests spend, it doesn’t matter how many television ads are run -- ultimately (inaudible.)
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First of all, when I think about some of those early events that we had here in Austin and around the country back in 2007, 2008, the reason I ran and the reason I think so many of you supported me was because we had a certain vision of what makes America great. And it doesn’t just have to do with the height of our skyscrapers or the power of our military, but it has to do with this basic idea that here in this country, if you work hard, you can make it. It doesn’t matter what you look like, where you come from, what your last name is, that if you apply yourself and take responsibility for not just yourself but your family and your community and your country, that you can succeed. And we felt as if that basic bargain that built the largest middle class in history and made us an economic superpower, that that was fading away for too many people. And this was before the financial crisis hit.
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Our opponent’s entire plan -- the same plan of his allies in Congress -- is to cut more taxes for the wealthy, cut more regulations for banks and insurance companies, cut more investments in things like education and research.
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When the American auto industry was on the brink of collapse, more than 1 million jobs on the line, Governor Romney said let’s "let Detroit go bankrupt."
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I refused to turn my back on a great industry and on American workers. I bet on American workers. I bet on American manufacturing. And three years later the American auto industry has come roaring back.
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As Americans, we don't expect handouts, but we expect hard work to pay off. We understand there will be setbacks, but we also know that responsibility should be rewarded. We believe that if you put enough effort into it, enough elbow grease into it, you should be able to find a job that pays the bills -- you should be able the have a home that you call your own, health care that you can count on if you get sick. You should be able to retire with dignity and respect. You should be able to provide your children with an education that gives them an even better shot than you had. That's what we believe.
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Jacksonville, we are here today because we recognize that this basic bargain, this essence of who we are as a people, this simple American Dream is at risk like never before. For more than a decade, it had been slipping away from too many hardworking people. Jobs and factories were shipped overseas. Folks at the top were doing better than ever before, but middle-class families saw their paychecks get smaller even as their bills got bigger. In Washington, the trillions that were spent on two wars and two tax cuts took us from record surpluses to record deficits. And on Wall Street, a culture of "anything goes" led to the worst economic crisis and financial crisis since the Great Depression.
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Now, ever since I first ran for this office, I’ve said it’s going to take more than one year or one term or maybe even one President to restore the dream that built this country. And the financial crisis and economic crisis made our job that much harder. But I don't get discouraged -- because the cynics who say that our best days are behind us, they haven’t witnessed the everyday courage and the essential character of the American people.
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They haven’t met the small business owners in Minnesota who chose to sacrifice some of their own perks, some of their own pay, to avoid laying off a single worker during that recession. They haven’t been to the auto companies in Michigan and Ohio that were never supposed to build another car again, but now they can't build them fast enough.
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So I want to make sure that the high-tech manufacturing jobs of tomorrow -- not just in the auto industry but in every industry -- that those advanced manufacturing jobs are taking root not in China, not in Germany, but in Jacksonville -- and in Cleveland and in Raleigh and in Richmond.
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Governor Romney’s experience has been owning companies that were called "pioneers" in the business of outsourcing, wants to give tax breaks to companies that ship jobs overseas. I want to give tax breaks to companies that are investing here in the United States -- rewarding companies that are investing here and hiring American workers, so we can sell products around the world stamped with three proud words: Made in America. That's why I’m running.
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Now, I ran in 2008 because that basic bargain, that belief that hard work should pay off, it seemed as if that simple American Dream was at risk like never before. For more than a decade, it had been slipping away from too many hardworking people. Jobs and factories were shipped overseas. Folks at the very top were doing better than ever before, but the middle class, the folks who are the heartbeat of this country -- for middle-class families and those trying to get into the middle class, it seemed as if paychecks were getting smaller and bills were getting bigger.
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Yes, well, it sounds like you've heard the plan. Their plan is to cut taxes more for the wealthy, cut more regulations on banks and insurance companies and unscrupulous lenders, and cut more investments in things like education and research -- and hope that somehow all that is going to create more prosperity for everybody.
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Because when middle-class families are doing well and they’ve got a little money in their pockets, that means they’re spending it with the local restaurant and the local business. So suddenly businesses have more customers and they start hiring more workers. And you get a virtuous cycle where everybody does well. That’s the recipe for success.
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So I want to make sure that what we did with the auto industry, let’s do it with manufacturing all across the country -- right here in Florida, all across the country. Let’s put people back to work. And one of the ways we can do it is instead of giving tax breaks to companies that are shipping jobs overseas, let’s give tax breaks to companies that are investing here in the United States and hiring American workers. I want to sell goods around the world made in America. That’s what I believe in. That’s why I’m running for a second term.
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And it’s important for the local economy, but it’s also important for the American economy. We used to have the best stuff -- the best airports, the best roads, the best everything, but we’ve been slipping because we haven’t been making those investments. And you know what happens when you defer maintenance -- if you don’t fix the roof, what happens? That’s going to cost you more later on. Why wouldn’t we want to put some folks back to work right now rebuilding America? That’s good for the economy. It’s good for our future.
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Now, me and Mr. Romney, we’ve got a lot of differences and I’ve just mentioned a few. Here in Florida, we’re all still concerned that the housing market is weak. You’re starting to see some signs of life around the country, but it’s still a lot of homes underwater. Mr. Romney’s plan is to just let the market bottom out. That’s his plan. That’s not a solution, that’s a problem.
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And this brings me to the last promise I want to discuss with you. Four years ago, I said that I’d do everything I could to help our veterans realize the American Dream, to enlist you in building a stronger America. After all, our veterans have the skills that America needs. So today, our economy is growing and creating jobs, but it’s still too hard for too many folks to find work, especially our younger veterans, our veterans from Iraq and Afghanistan. And with a million more troops rejoining civilian life in the years ahead -- and looking for work -- we’ve got to step up our game, at every stage of their careers.
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Now, obviously we've gone through, since I last saw you, the worst financial crisis and the worst economic crisis since the Great Depression. The good news is that we’ve made progress since that time -- added 4.5 million new jobs, half a million new manufacturing jobs. Even the weakest sectors of the economy, like housing, are starting to pick up again. And so we are in a much better position now, in part because of the work that my administration has done -- saving the auto industry and stabilizing the financial system -- we’re in a much stronger position now than we were the day I was sworn in.
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We've gone through a decade in which people were working harder but making less money, while the cost of everything from college education to health care were going up. We had fought two wars on a credit card. We had taken a surplus, and because of tax cuts that weren't paid for, we had turned them into deficits. And it all culminated in incredible recklessness on Wall Street that resulted in the worst financial crisis and economic crisis in our history.
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Now, this crisis has been deeper and more brutal than I think anybody back then anticipated. But over the last three and a half years, everything I've done -- everything my administration has done -- has stayed focused on that goal. And so, where we were losing 800,000 jobs a month when I was sworn into office, we've been creating jobs now for almost three years straight -- 4.5 million new jobs -- 500,000 in manufacturing, the fastest manufacturing growth since the 1990s. We've helped to make sure that small businesses were able to survive this brutal recession and invested in them.
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Anybody who thinks that our best days are behind us, they haven't met the small business owners in Minnesota who chose to sacrifice some of their own perks and pay just to avoid laying off a single worker during the recession. They haven't been to auto plants in Michigan or Ohio that were never supposed to build another car again, and now can't build them fast enough.
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That's how we've grown our economy. In some ways, the other side understands that their theories aren't particularly popular. So rather than explain them clearly, they're going to spend most of their time trying to distort what I say. Earlier today, Governor Romney was at it again. He has been twisting my words around to suggest that I don't value small business. Now, keep in mind, in politics you have to endure a certain amount of spin. Everybody does it. I understand that. Those are the games that are played in campaigns. Although I have to say, when people omit entire sentences from a speech -- and they start splicing and dicing, they may have tipped a little bit over their skis. They may have gone over the edge here.
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But there's a real choice here. As I said, I believe with all my heart that it is the drive and ingenuity of Americans who start businesses that lead to their success. And by the way, that's why I've cut taxes on small businesses 18 times since I've been President. I believe the ability for somebody who is willing to work hard, and sweat and sacrifice to turn their idea into a profitable business, that's what makes us such a robust, dynamic economy. We prize that.
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But I also believe that if you talk to any business owner -- small or large -- they'll tell you what also helps them succeed alongside their hard work, their initiative, their great ideas, is the ability to hire workers with the right skills and the right education. What helps them succeed is the ability to ship and sell their products on new roads and bridges and ports and wireless networks. What helps them succeed is having access to cutting-edge technology, which like the Internet often starts with publicly funded research and development. And what helps them succeed is a strong and growing middle class, so they've got a broader base of customers.
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And Mr. Romney disagrees with this, and he is entitled to his opinion. But the approach that he is talking about is not going to help small businesses and it's not going to create more markets for large businesses. He is wrong. We did not build this country on our own. We built it together. And if Mr. Romney doesn't understand that, then he doesn't understand what it takes to grow this economy in the 21st century for everybody.
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Let me give you another example -- because this is going to be discussed over the next three months -- the issue of debt and deficits. Now, we've got to reduce our debt and we've got to reduce our deficits. I, when I came into office, had a trillion dollars of deficit waiting at my doorstep. And, obviously, the recession made it worse. But we've got to take this seriously over the long term. The question is how do we reduce it in a balanced way that promotes economic growth.
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Let me tell you some things that will work. When the American auto industry was on the brink of collapse and more than 1 million jobs were on the line, Governor Romney said, let’s "let Detroit go bankrupt." I said, let’s bet on American workers and American ingenuity, and now GM is back on top. And Ford and Chrysler are building more cars than ever. And so what I’ve said is, let’s not stop at Detroit. Let’s not stop at the auto industry. Let’s make sure that we’re promoting American advanced manufacturing all across the country.
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And we're here today for the same reason that so many of us came together in 2008, because this basic bargain, this core American Dream is at risk. And it's been at risk like never before. For more than a decade before I was sworn in, it had been slipping away from too many hardworking people. Jobs in factories were shipped overseas. Folks at the top were doing better than ever, but middle-class families saw their paychecks get smaller, saw their bills get bigger. And in Washington, trillions were spent on two wars and two tax cuts that took us from record surpluses to record deficits, while on Wall Street a culture of "anything goes" led to the worst financial and economic crisis since the Great Depression.
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Ever since I first ran for this office, I've said that it will take more than one year or one term or even one President to restore the dream that this country built. And, obviously, the crisis that we went through made it that much harder. But for those cynics who say that our best days are behind us, they haven't witnessed the everyday courage and character of the American people. They have not met the small business owners in Minnesota who chose to sacrifice some of their own perks and pay just to avoid laying off a single worker during the recession. They haven't met those folks in the auto plants in Michigan and Ohio that were never supposed to build another car again, but now they can't build them fast enough.
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So I continue to feel as optimistic, as hopeful about the capacity for us to institute meaningful change as I ever have been. What’s standing in our way right now -- despite all the progress we’ve made, despite the health care bill that we passed, despite Wall Street reform -- despite saving the auto industry -- despite all that, what’s holding us back right now is not the lack of big ideas. It’s what’s going on in Washington -- this uncompromising view that the only path forward is to go back to the same top-down economics that got us into this mess in the first place.
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So we’ve got two contrasting visions for where we want to take the country. And frankly, the other side knows they can’t sell their ideas so what they’re going to do is try to distort my vision. Earlier today, Governor Romney was at it again -- knowingly twisting my words around to suggest that I don’t value small businesses.
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I’ve always said don't bet against American workers, don't bet against American ingenuity. And I believe that the free market is the greatest source of prosperity in our history. But I also believe that if you talk to any business owner, they’ll tell you that what also helps them succeed alongside all their hard work, all their great ideas, is the ability to hire workers with the right skills and education. What helps them succeed is the ability to ship and sell their products on new roads and bridges and ports and wireless networks. What helps them succeed is having access to cutting-edge technology, which, like the Internet, often starts with publicly funded research and development. And what helps them succeed is a strong and growing middle class who can buy the products that they’re selling. Every business needs customers.
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Now, for two centuries, we’ve made these investments -- not as Democrats or Republicans, but as Americans who understand what it takes to give our people and our businesses the best possible chance at success. But my opponent disagrees. Mr. Romney’s plan is to gut these investments just so that he can give more tax breaks to millionaires and companies that are shipping jobs overseas. He thinks that’s the best way to grow the economy.
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He thinks that’s the best way to help small businesses. And I’ve got to tell you, Oakland, he is dead wrong. We did not build this country from the top down. We built this country together -- individual entrepreneurs taking advantage of opportunities and putting their sweat and tears into it, and all of us making investments in things like public schools and public colleges and universities -- the Hoover Dam and the Golden Gate Bridge. That’s how we sent a man to the moon. That’s how we saw medical breakthroughs that saved millions of lives.
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And Governor Romney, his main calling card in this election is, I’ve got private sector experience. Well, you know what, his experience has been investing in companies that were called "pioneers" in the business of outsourcing. He wants to keep giving tax breaks to companies who are shipping jobs overseas. I'm a big proponent of insourcing. I want to end these tax breaks and start rewarding companies that create jobs right here in Oakland, right here in the United States, making products that we sell around the world, stamped with three proud words: Made in America. That's what I believe. That's why I'm running for a second term.
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Now, over the course of the next four months, the other side will spend more money than we have ever seen on ads that basically tell you the same thing you’ve been hearing from them for months. Like I said, they don't really have an economic plan. They know their economic theory is not going to sell. So really what their ads all boil down to is: The economy is not where it should be, and it’s Obama’s fault. It’s very simple, easy to summarize. You will continue to see a variation on this theme.
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Now, today we're battling our way back from a once-in-a-lifetime economic crisis. And make no mistake, we've made progress in that fight. When I took office, we were losing hundreds of thousands of jobs a month. Our auto industry was on the brink of collapse. Factories were boarding up their windows. We'd gone through almost a decade in which job growth had been sluggish, incomes had declined, costs were going up -- all culminating in the financial system coming close to a breakdown.
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Today, three and a half years later, we've had 28 straight months of private sector job growth. Three and a half years later, the auto industry has come roaring back. Three and a half years later, companies are beginning to bring thousands of jobs back to American soil.
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Let me tell you what I believe. I believe that strong communities are places that attract the best jobs and the newest businesses. And you don’t build that kind of community by giving tax breaks to companies that are shipping jobs overseas. You build it by giving tax breaks to companies that create jobs in Detroit and in Cleveland and in Chicago and right here in New Orleans, right here in America -- using American workers, making American products that we sell around the world, stamped with three proud words -- Made In America.
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You build it by investing in America’s manufacturing base and providing the dollars for research so that we have the most advanced products in the world. You do it by investing in small businesses -- the way we’ve provided 18 tax breaks to small businesses since I’ve been in office. And if you’re a company that wants to relocate in a community that’s been particularly hard hit when a factory left town, I believe you should get help financing that new plant or equipment, or training for your workers -- because we can’t leave anybody behind if we want to grow America the way it can grow.
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We also believe that every entrepreneur should have the chance to start a business –- no matter who you are, no matter what you look like. That’s why we've supported financing and assistance and exporting to small businesses across the board. That’s why we’ve helped African American businesses and minority-owned businesses and women-owned businesses gain access to more than $7 billion in contracts and financing -- that allowed them to grow and create jobs.
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That’s why we’ve emphasized helping our veterans create small businesses -- because if they fought for us, they shouldn’t have to fight to get financing when they get home. They shouldn’t have to fight for a job when they come home. They shouldn’t have to fight for a roof over their heads when they come home. We should honor them the way they’ve honored us with their service.
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And while we’re at it, let’s put construction workers back on the job -- because they've been hit by the housing bubble bursting. Let's put them back on the job not only rebuilding roads and bridges and ports, but also rehabilitating homes in communities that have been hit by foreclosures, businesses that have been hit hardest by the housing crisis. That creates jobs. It raises property values, and it strengthens the economy of the entire nation.
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For the last three and a half years, everything I have done as President has been focused on that principle. And, obviously, as we saw this economic crisis unfold, we understood that the change we believed in would take more than one year, more than one term and probably take more than one President. But over the last three and a half years, we've started to steer things in the right direction.
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We were losing 800,000 jobs a month when I was sworn in. Now, we've seen more than two years of job growth every single month. We're at 4.5 million new jobs. An auto industry on the brink of collapse -- we made sure that we bet on American workers and American manufacturing. And it's come roaring back. We moved to make sure that college was more affordable for young people, and that more Americans had access to health care.
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You haven’t met the small business owners who decide to keep everybody on payroll, even if they couldn't pay themselves, because they believed in doing the right thing. You haven't talked to some of these autoworkers in these plants that folks thought would never build another car again and now can't build them fast enough. You haven't met folks who at the age of 50 or 55, went back to community college, sitting next to a bunch of 20-year-olds, because they believed in retraining themselves, and now are finding jobs in biotechnology or clean energy.
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Now, I've got to tell you this makes no sense. If Congress doesn't act, the typical middle-class family is going to see their tax bill go up about $2,200. Small businesses will also see their taxes go up. So I’ve called on the House Republicans to drop their demands for another trillion-dollar giveaway for millionaires and billionaires so that we can make sure that middle-class families and small businesses have the financial security and certainty that they need.
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So after almost a decade of war, I think it’s time to do some nation-building here at home. (Applause. I want to take half the money that we are saving and put people back to work rebuilding roads and bridges and ports and new schools. That’s good for the construction industry, it's good for the construction workers, but it also means that those folks have some money in their pockets and they can come down to New Orleans and spend some of that money, and help this local economy. And it lays the foundation for economic growth for decades to come.
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So it hasn’t been enough. Even though job one was to get us back on a path of recovery, the broader mission is how do we make sure that everybody has got a fair shot in this society, everybody is doing their fair share, and everybody is playing by the same set of rules -- which is why health care reform was important, because that’s part of security for middle-class families. That’s why Wall Street reform was important, because we’ve got to make sure that people have confidence in our financial system, and that it’s not being gamed, or reckless bets don’t potentially bring down the entire financial system.
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I disagree with that theory. I think it’s wrong, partly because empirically we tried it. We tried it for a decade and it didn’t work. And the approach that I’m talking about in terms of balanced deficit reduction and investments in science and education and infrastructure -- we’ve tried that, too, the last time there was a Democratic President. And we created 23 million new jobs and went from deficit to surplus. And, by the way, business people, large and small, did really well -- because one of the lessons of our economic history is, is that when we’ve got a strong middle class, then businesses have customers and everybody does well, everybody grows.
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Now, over the last three and a half years we've had a lot of work to do. But because of our efforts, instead of losing 800,000 jobs per month we created 4.5 million jobs over the last several years -- half a million in manufacturing, strongest manufacturing job growth since the 1990s. We saved an auto industry that was on the brink of collapse. We were able to stabilize the financial system, help small businesses, and slowly the unemployment rate has begun to come down.
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So let me tell you what my vision is. My vision is that just as we were able to make sure that the auto industry in America stayed strong, we’ve got to bet on American workers and American manufacturing, and that means we got to stop giving tax breaks to companies that ship jobs overseas. Let’s give tax breaks to companies that are investing right here in the United States of America, right here in Virginia -- because we’ve got the best workers in the world and the best innovation in the world. What we need is a tax code that works for folks who are investing here in the United States. That's my vision.
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I don't want to refight the battles we’ve already fought. Health care was the right thing to do. Thirty million people will have health insurance that did not have it before. Your children can stay on your health insurance plan till they're 26 years old. Women are getting preventative care. We are not going to go back to the old days when insurance companies could just jerk you around for no reason. The Supreme Court has spoken. We are now implementing it, and America is going to be better for it.
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Now, over the last three and a half years we've had a lot of work to do. But because of our efforts, instead of losing 800,000 jobs per month we created 4.5 million jobs over the last several years -- half a million in manufacturing, strongest manufacturing job growth since the 1990s. We saved an auto industry that was on the brink of collapse. We were able to stabilize the financial system, help small businesses, and slowly the unemployment rate has begun to come down.
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So let me tell you what my vision is. My vision is that just as we were able to make sure that the auto industry in America stayed strong, we’ve got to bet on American workers and American manufacturing, and that means we got to stop giving tax breaks to companies that ship jobs overseas. Let’s give tax breaks to companies that are investing right here in the United States of America, right here in Virginia -- because we’ve got the best workers in the world and the best innovation in the world. What we need is a tax code that works for folks who are investing here in the United States. That's my vision.
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I don't want to refight the battles we’ve already fought. Health care was the right thing to do -- 30 million people will have health insurance that did not have it before. Your children can stay on your health insurance plan till they're 26 years old. Women are getting preventative care. We are not going to go back to the old days when insurance companies could just jerk you around for no reason. The Supreme Court has spoken. We are now implementing it, and America is going to be better for it.
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Obviously, we’re still recovering from the worst financial crisis since the Great Depression. We have made progress -- 4.5 million new jobs, half a million in manufacturing, the strongest since 1990. The housing market, which has been a huge headwind on the recovery, is just now starting to tick back up again. And there are so many reasons why America is well-positioned relative to the rest of the world to make sure the 21st century is still the American Century.
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Four years ago, I promised the American people I was going to cut taxes on middle-class families -- and that's what I did. The typical middle-class family is actually paying $3,600 less in their taxes than when I came into office. And I want to keep income taxes exactly where they are for everybody who's making $250,000 a year or more [sic] -- which is about 98 percent of the American people, and 97 percent of small businesses. So if your income is $250,000 or less, your income taxes will not go up a dime.
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That's the choice in this election. That's why I'm running for a second term as President of the United States.
Now, that choice -- you can see it in every issue between myself and Mr. Romney. When the auto industry was on the brink of collapse, Governor Romney said, let's "let Detroit go bankrupt." I said, with a million workers and an iconic American industry on the line, I’m going to bet on the American worker. And you know what, three years later, GM is number one again and the American auto has come roaring back. That’s the choice in this election.
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So now I want to make sure that high-tech manufacturing takes root not in China, not in Germany, but here in the United States. I want to stop giving tax breaks to companies that are shipping jobs overseas. Let’s give those tax breaks to companies that are investing here in Chicago, investing in Cleveland, investing in Pittsburgh. Let’s create jobs here in the United States -- hiring American workers, making American products, selling them around the world, stamped with three proud words: Made in America. That’s the choice in this election.
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On every issue, there is a stark contrast. When it comes to homeownership, my opponent says, just let the foreclosures bottom out. That’s not a solution. I want to make sure that homeowners across American can refinance at historically low rates, save $3,000. How many people here can use an extra $3,000? That would strengthen the housing market and put money in people’s pockets that will make the economy stronger.
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But, listen, it is wonderful to be back in Iowa. It is wonderful to see some familiar faces and some good friends on a beautiful summer day. It was on your front porches and in some of your backyards where our movement for change started. We spent a lot of time in Iowa, and I felt like an adopted son of Iowa. We took bus tours all throughout the state -- although I've got to admit the bus wasn’t as nice as the one I've got now. And we went to school gyms and family farms and small businesses all across the state.
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That is the core of the American Dream. That's the American promise. Now, the problem is, is that we had gone through a decade where that promise wasn’t being met, it wasn’t being kept. So we had gone through a decade where jobs were being shipped overseas, where you were working harder but you were bringing in less. Costs of college, costs of health care were all going up -- cost of food, cost of gas all were going up. We ran two wars on a credit card. Tax cuts we didn’t need and that didn’t create jobs. And it all culminated in the worst financial crisis since the Great Depression.
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And so, for the last three and a half years we've rolled up our sleeves and we've worked hard. And small businesses have kept their doors open. And folks, even if they got laid off, they've retrained to find new jobs. And we created 4.5 million new jobs, half a million more in manufacturing. The auto industry is back on top.
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Now, here's the thing. Some people, they're naysayers and they say, oh, America is declining. And they try to paint things as dark as possible, especially during election time. But here's what I want everybody to know. We've got so many things going for us compared to the rest of the world. We've still got the best workers in the world. We've got the best entrepreneurs in the world. We've got the best scientists and the best researchers in the world. We've got the best colleges and the best universities in the world. We know how to work hard. And we're a young country and we're a country that draws on the diversity of folks who want to come here from all around the world to be part of this American Dream. And most importantly, the crisis has not changed our character. It hasn't changed who we are. It hasn't changed our sense of determination and our sense of neighborliness and our understanding that we're in this thing together.
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Just as I said that we've got a lot of things going for us, there aren't any quick fixes or easy solutions to some of our challenges. We're going to have to keep working. We're going to meet these challenges. But the main problem we've got is not a lack of good ideas. It's not that we don't have good solutions to our problems. The big problem we've got right now is politics in Washington. The big problem we've got is one party just thinks that compromise is a dirty word. And they've got an economic theory that basically wants to go back to the old top-down economics that got us into this mess in the first place.
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There's a difference between me and Mr. Romney on almost every issue. When the American auto industry was on the brink of collapse, more than 1 million jobs were on the line, Governor Romney said let's "let Detroit go bankrupt." I said let's bet on the American worker. And three years later, the American auto industry is back on top. GM is number one again.
Now, so I want to make sure that hi-tech manufacturing jobs are taking root right here in Boone -- not in China, not in Germany.
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Governor Romney, he likes to tout his private sector experience. But a lot of that experience is investing in companies that were called "pioneers" of outsourcing. We don't need more outsourcing. We need some insourcing.
I want to take away tax breaks. Let's stop giving tax breaks to companies that are shipping jobs overseas. Let's give those tax breaks to companies that are investing right here in Iowa, right here in the United States of America. That's the choice in this election.
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I've directed the Department of Agriculture and the Small Business Administration to help give farmers and small businesses across 32 states access to low-interest emergency loans. We've opened up federal land for grazing. We're working with insurance companies to give farmers a short grace period on their premiums, since money will be tight for a lot of families at the end of the crop year. And last week, we announced another $30 million to help get more water to livestock and restore land affected by the drought.
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And so we knew that restoring the basic bargain that made this country was not going to be easy. We knew it would take more than one year, or one term, or even one President. And that was before the crisis hit and we saw friends and neighbors lose their job, or lose their home, lose their savings, pushing the American Dream even further out of reach for too many working people.
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Now, I want to keep your taxes right where they are for the first $250,000 of everybody’s income. So if your family makes under $250,000 -- which, by the way, is 98 percent of Americans -- you won’t see your income taxes go up by a single dime next year. Ninety-seven percent of small businesses will not see their taxes go up.
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You know, across the board, there is a sharp contrast between me and Mr. Romney. When the auto industry was on the brink of collapse, more than a million jobs at stake, Governor Romney said, “let Detroit go bankrupt.” I bet on American workers. I bet on American manufacturing. And three years later, the American auto industry has come roaring back. So now I want to make sure that high-tech manufacturing jobs are taking root here, not in China. I want them to take root here in Council Bluffs.
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Governor Romney, he likes to brag about his private sector experience. A bunch of that private sector experience was investing in companies that have been called “pioneers” of outsourcing. Let me tell you something -- I want insourcing, not outsourcing. I want to stop giving tax breaks to companies that are shipping jobs overseas. Let’s give tax breaks to companies that are investing here in the United States of America -- hiring American workers to make American products to sell around the world, stamped with those words: Made in America. That’s what I believe in.
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And so, we’ve spent the last three and a half years trying to get things back on track, trying to right the ship -- saving an auto industry that was on the brink of collapse, creating 4.5 million new jobs, half a million jobs in manufacturing, which is the highest rate that we’ve seen since the 1990s. Slowly, we’ve been trying to help the housing market recover.
But the fact is we’ve still got millions of people around the country who are struggling. We’ve still got folks who are out of work, folks who have lost their homes or their homes are underwater, young people who still are trying to figure out how they can afford college, or if they’ve gone to college, a
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And that’s why, in addition to dealing with that immediate aftermath of this economic crisis, we also said let’s do something about health care, and let’s make sure that everybody who is out there working hard and doing the right thing, that they’re not going to go bankrupt because they get sick, that they’re going to have health care they can count on. And we got that done.
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That’s why we set out to reform Wall Street, because we believe that we’ve got to have a dynamic, vibrant financial sector, but we want the financial sector to do what it’s supposed to be doing, which is financing businesses and families and growing an economy, not just making reckless bets. And we got that done with Wall Street reform.
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Now, we have as stark a choice in this election as we've seen in my lifetime. In some ways, it's starker than it was in 2008. The Republican nominee, Mr. Romney, and his new running mate, Congressman Ryan, their basic idea is that what's holding us back is not banks that take reckless risks, or insurance companies that are taking advantage of consumers, or the fact that we've still got a global economic crisis that we're digging our way out of. Their view is that if we give tax cuts to the wealthiest Americans and we get rid of all kinds of regulations -- regulations that help make sure that our air is clean and our water is clean, regulations that we've put in place to protect consumers from unscrupulous lenders, regulations that we've put in place to make sure that women are getting equal pay for equal work -- regulations to protect workers and consumers -- that somehow if we get rid of that stuff, then somehow the economy is going to thrive and prosperity will trickle down on everybody.
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We’ve got preventive care for everybody. Insurances can’t drop you. And women are having more control over their health care choices. That was the right thing to do. We’re not going backwards. We’re going forward.
Mr. Romney, his plan for strengthening our housing market is just let the thing bottom out, let foreclosures bottom out. That’s not a solution. What we’ve said is let’s let families whose homes are underwater, let’s let them refinance at historically low rates, and put an extra $3,000 in their pocket. And that can help them build up equity, strengthen the housing market, circulate in the economy. That’s a choice in this election.
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And we knew it wasn’t going to happen overnight. We knew it was going to take more than one term, maybe even one President, to get this country back to the place where everybody has got a fair shot. But we started. And three and a half years ago, we saved ourselves from going into a Great Depression. And 4.5 million jobs have been created, and half a million manufacturing jobs. And the auto industry got saved. We’re now at a point where a lot of folks are still struggling. And so we’ve got to move forward and not backwards. We’ve got to move forward.
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Now, the good news is we’ve got everything we need to succeed. We’ve still got the best workers in the world. We’ve still got the best universities and colleges in the world. We’ve got the best researchers and scientists in the world. We’ve got the best entrepreneurs, small businessmen and women, and large businesses that are the best in the world, making some of the best products. We’ve got everything that we need.
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See, I believe in a different theory. When it comes to taxes, I said in 2008 I was going to lower middle-class taxes. And guess what -- I did. So the average family -- the typical family is paying $3,600 less in taxes than they were when I came into office. So what I believe now is I want to keep your income taxes right where they are for everybody making $250,000 or less -- which is 98 percent of Americans, 97 percent of small businesses. And folks who are in the other 2 percent, who are fortunate enough to be in the top 2 percent, they still get a tax cut for the first $250,000. But after that, we're asking them to pay a little bit more so we can finance things like education and reduce our deficit in a balanced, responsible way.
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We don't believe in top-down economics. The history of this country has been a middle class-out economics, a bottom-up economics. When everybody is doing well, when everybody has opportunity, then we all succeed and the country moves forward. That's what's at stake in this election. That's why I'm running for a second term as President of the United States.
You see the difference in philosophies on almost every issue. When the automakers were on the brink of collapse, a million jobs at stake, Governor Romney said let's "let Detroit go bankrupt." I said let's bet on American workers. And three and a half years later, the American auto industry has come roaring back.
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So we know American manufacturing can succeed in this country -- high-tech manufacturing, advanced manufacturing -- but we've got to make sure we've got a tax code that encourages it. I want to stop giving tax breaks to companies that are shipping jobs overseas. Let's give tax breaks to companies that are investing here in the United States of America, hiring American workers, making American products.
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And because of it, 6.5 million young people can stay on their parent's plan. Because of it, we've got millions of seniors out there who are seeing more discounts on their prescription drugs, and we're closing the doughnut hole. Because of what we're doing, more people are getting preventive care. Because of what we're doing, insurance companies can't drop you right when you need insurance most just because of some fine print.
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And so, we knew this wasn't going to be easy. And when the crisis hit in 2008 and 2009, millions of people all across this country -- some of our friends and neighbors and family members -- lost their jobs, lost their homes, lost their savings. And that made the American Dream even a little bit further out of reach.
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And it’s because of that character that over the last three and a half years we’ve made some progress. We’re not all the way back to where we need to be, but we’ve created four and a half million new jobs -- half a million new jobs in manufacturing. We have seen small businesses start to open back up. We’ve seen workers getting retrained and getting rehired. And so we’ve made progress.
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So now what I want to do is to keep your income tax rates exactly where they are. I don’t want your taxes going up for the first $250,000 of income that you make -- which, by the way, covers about 98 percent of all Americans and 97 percent of all small businesses. Your taxes -- your income taxes would not go up one single dime next year if Congress does what I’ve asked them to do.
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I want to stop giving tax breaks to companies that are shipping jobs overseas. Let's give them to companies that are investing right here in Iowa and right here in the United States of America, hiring American workers, making American products that we're selling around the world stamped with three proud words: Made in America. That's what I believe in. That's why I'm running.
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So on almost every issue, you're going to have a choice. When the auto industry was on the brink of collapse, Governor Romney said let's "let Detroit go bankrupt." I said that’s a million workers at stake, and I believe in American workers. And three years later, the American auto industry has come roaring back.
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My plan has already extended Medicare by nearly a decade. Their plan ends Medicare as we know it. My plan reduces the cost of Medicare by cracking down on fraud and waste and subsidies to insurance companies. Their plan makes seniors pay more so they can give another tax cut to millionaires and billionaires.
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And right now, what I want to do is to keep taxes right where they are for the first $250,000 of everybody’s income. If your family makes under $250,000 -- like 98 percent of American families do and 97 percent of small businesses do -- you won’t see your income taxes increase by a single dime next year. Now, if you’re fortunate enough to be in the other 2 percent --
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On just about every issue, Governor Romney and I just have a different opinion. When the auto industry was on the brink of collapse, more than a million jobs at stake, Governor Romney said let's "let Detroit go bankrupt." I said let's bet on American workers. And we got workers and management together, and they changed how they were doing business. And three years later, the American auto industry is back on top. That's what I believe. That's the kind of America we need.
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But the reason that's important, it's worth reminding people, is because it was on your front, it was in your backyards, where our movement for change began. We spent a lot of time on bus tours like the one I'm taking right now -- although the bus wasn’t as nice as it is now. And we went to school gyms and family farms and small businesses across the state. And so it was pretty good being back here -- yesterday I went to the State Fair and I had a pork chop and a beer. And it was good. Today I just had a beer. I didn’t get the pork chop. But the beer was good, too.
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That's the track record of the other party the last time they were in charge. And we knew that restoring the bargain that made this country great would not be easy. It was going to take more than one year, or one term, or even more than one President, but we knew we had to get started. And obviously it became that much harder when the middle class was hammered by this crisis, because a lot of folks lost jobs, lost homes, lost savings, and that American Dream seemed even further out of reach.
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No, no, no, listen, I know Congressman Ryan. He is a decent man. He is a family man. He is the ideological leader of the Republicans in Congress. And he's an articulate spokesperson for Governor Romney's vision. The problem his vision is wrong. See, my opponent, Governor Romney, and his friends in Congress, they believe -- this is their whole platform, this is their basic plan, as much detail as you get, this is what you get. Their plan to grow the economy is to eliminate regulations, including on big banks and insurance companies -- some of the regulations we put in place to make sure, for example, that we don’t have another taxpayer-funded bailout, so he wants to get rid of regulations, and then what he wants to do is give more tax breaks to the wealthiest Americans. And the idea, then, is that jobs and prosperity will trickle down on everybody. That’s the centerpiece of his plan. You can go on his website.
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Now, what I want to do is I want to keep everybody’s taxes right there where they are for the first $250,000 of everybody’s income. So if your family makes under $250,000 -- like 98 percent of families do, and 97 percent of small businesses do -- then you won’t see your income taxes go up by a single dime next year. Not one dime.
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See, Waterloo, this comes down to your basic philosophy, but also, when you look at the evidence of our economic history -- when teachers and nurses and firefighters and receptionists and construction workers, when you’ve got a little more money in your pocket, what do you do? You spend it. Because times are tight, right? So if you’ve got a little extra money, now maybe you finally trade in that 10-year-old car you’ve been driving. Maybe you buy a computer for your kid who is about to go to college. So suddenly businesses have more customers, which means they’re making more profits, which means they’re hiring more workers, who then spend more money, and suddenly the economy gets better for everybody -- including folks at the top.
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But you know what? That’s not the only difference between me and Mr. Romney. When the auto industry was on the brink of collapse -- you remember that -- more than a million jobs at stake, Governor Romney said, let’s "let Detroit go bankrupt." I said, let’s bet on American workers. And management and workers got together in a great, iconic American industry, and you know what? Three years later, the American auto industry is roaring back.
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I want to see high-tech, advanced manufacturing come back all across America in other industries. I don’t want those jobs in China or Germany. I want them here in Iowa. Governor Romney says, well, no, look, I understand the economy because I’ve been in the private sector. Well, a lot of that experience was investing in companies, including those that were called “pioneers” in the business of outsourcing. He wants to keep giving tax breaks to companies that ship jobs overseas. I want to end those tax breaks once and for all and start rewarding companies that are investing right here in the United States of America, hiring American workers, making American products. That’s the choice in this election.
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Issue Position |
Romney has portrayed himself as a turnaround artist, emphasizing his experience in the private sector, his leadership in tackling budget deficits in Massachusetts and his role in cleaning up the scandal-plagued 2002 Winter Olympics. He has championed permanent tax cuts and regulatory reform while giving mixed reviews to President Obama’s bailout and economic-recovery programs.
Romney has favored permanent tax cuts rather than subsidies to boost the economy. In 2009, he told the federal Economic Stimulus Work Group: “There are two ways Washington can put money into the economy — one is by sending it back to the taxpayers and the other is by spending it. Of the two, it’s the former that has the bigger bang for the buck.”
The former Massachusetts governor has produced an economic plan that calls for cutting the corporate tax rate to 25 percent, lowering tax rates on investments and savings and reducing regulations. He has also advocated a tougher stance on China that includes sanctions for currency manipulation and punishment for stealing intellectual property.
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Romney's Statements (70)
25 million Americans are out of work, or have stopped looking, or have only part time jobs but want full-time work. Hispanics have been hit terribly hard, with an unemployment rate that is higher than the national one. Home values have dropped more than they did during the Depression and Florida has seen some of the worst of it. National debt is almost as large as our entire economy, and we owe a huge chunk of it to China.
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Twenty-seven years ago, I joined with some friends to start a business. We started with ten employees, and grew it to become one of the most successful enterprises of its kind in the world.
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My work led me to become deeply involved in helping other businesses, from innovative startups to large companies going through tough times. Sometimes I was successful and helped create jobs, other times I wasn’t. I learned how America competes with companies in other countries, what works in the real world and what doesn't.
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As each of you looks beyond this great institution, to the life before you, I know you face many difficult questions in a world fraught with uncertainty. America is in an economic crisis the likes of which we have never seen in our lifetime. Europe is struggling with the greatest economic crisis since the Cold War, one that calls into question the very definition of the European Union.
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The unemployment rate has been over 8% for 33 months. Our country has been running a deficit for 36 months. And just last week, nearly 400,000 Americans filed new jobless claims.
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In an entitlement society, the invigorating pursuit of happiness is replaced by the deadening reality that there is no prospect of a better tomorrow. Risk-taking disappears, innovation withers, and small business is replaced by large, government enterprises. And the result is a nation that stagnates, that declines, that cannot defend itself.
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I’ll do the math but let me tell you, I know we're going to get attacked from the left, from Barack Obama, on capitalism. I know people are going to say, oh, you should only practice it this way or that way and think they know better than the private market. My view is capitalism works. Free enterprise works. And I -- and I find it kind of strange on a stage like this with Republicans having to describe how private equity and venture capital work and how they're successful and how they create jobs. But let me tell you that answer. We started a number of businesses. Four in particular created 120,000 jobs. As of today. We started them years ago. They’ve grown well beyond the time I was there to 120,000 people that have been employed by those enterprises. There are other we’ve been with. Some we have been with, some of which have lost jobs. People have evaluated that – since – well, since I ran four years ago when I ran for governor. And those that have been documented to lost jobs lost about 10,000 jobs. So 120,000 less 10 means we created something over 100,000 jobs. There’s some, by the way, that were businesses we acquired that grew and became more successful like Domino's Pizza and a company called Duane Reade and others. I’m very proud of the fact that throughout my career we tried to build enterprises hopefully to try to return money to investors. There’s nothing wrong with profit, by the way. That profit -- that profit went to pension funds, to charities. It went to a wide array of institutions. A lot of people benefited from that and by the way as enterprises has become more profitable, they can hire more people. I’m someone who believes in free enterprise. I think Adam Smith was right. And I’m going to stand and defend capitalism across this country throughout this campaign. I know we're going to get it hard from President Obama but we'll stuff it down his throat and point out it is capitalism and freedom that makes America strong.
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Instead of solving the housing crisis and getting Americans back to work, President Obama has been building a European-style welfare state. He has pushed for a second stimulus and deep cuts to our national defense. He’s asking the American people for another trillion dollars – and another term in office.
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I will streamline regulation, ensure the prompt review of projects, and order agencies to focus on economic growth. The Keystone Pipeline is a real “shovel-ready” project that would put 20,000 Americans back to work. Three years of review is long enough. The President was wrong to reject it. I will approve it.
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During my 25 years in business, I helped companies like Staples and the Sports Authority grow from start-ups to international enterprises. I turned around companies, a state government, and an Olympics. And I am passionate about our economic liberty because I have seen it reward the hard work of many – and create prosperity for all.
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In the last ten days, I met a father who was terrified that this would be the last night his family would sleep in the only home his son has ever known. I’ve met seniors who thought these would be their best years and now live day to day worried about making ends meet. I’ve met Hispanic entrepreneurs who thought they had achieved the American Dream and are now seeing it disappear.
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Three years ago, a newly elected President Obama told America that if Congress approved his plan to borrow nearly a trillion dollars, he would hold unemployment below 8 percent.
Everywhere I go in this campaign, I meet Americans who are really suffering in the Obama Economy. You can see it on their faces and hear it in their voices – they are anxious and scared about the future. I’ve met moms and dads who are struggling to get by. One works the day shift while the other works at night just so they can make ends meet. I’ve met kids who are about to graduate college; they’re facing student loans and a bad economy, and they are worried that they won’t be able to get a job. Everywhere I go, I hear stories that serve as sad reminders of this failed presidency.
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Third, I will promote savings and investment by maintaining the 15% rate on capital gains and dividends. I will eliminate the tax entirely for those with annual income below $200,000. These low tax rates will encourage Americans to save and invest – and they will encourage business investment and economic growth.
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Now, I know that President Obama will criticize my proposal. So be it. I believe the American people are ready for real leadership. I believe they deserve a bold, conservative plan for reform and economic growth. Unlike President Obama, I actually have one – and I’m not afraid to put it on the table.
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This President likes to remind us that he inherited an economic crisis. But he never mentions that he also inherited a Democratic Congress. With majorities in the House and Senate, President Obama was free to pursue any policy he pleased.
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Did he fix the economy? Did he tackle the housing crisis? Did he get Americans back to work? No. He put us on a path toward debt, deficits, and decline. It is time to get off that path and get back on the path to prosperity.
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His budget foreshadows what lies ahead. Runaway spending and record debt were just the warm-up act. For an encore, he wants to raise taxes on job creators and small businesses and families. We will not let him!
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Norm didn’t get to go to college. He doesn’t have an engineering degree. But he does have over 100 patents to his name. He turned a small shop in his basement into a successful company that helped build an industry. And it’s entrepreneurs like Norm who are going to get the American economy back on track.
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In January 2009, President Obama's Economic Team Predicted The Trillion-Dollar Stimulus Package Would Keep Unemployment Below 8%. (Christina Romer and Jared Bernstein, “The Job Impact Of The American Recovery And Reinvestment Plan," 1/9/09)
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President Obama’s Latest Budget Breaks His Pledge And “Does Not Come Close” To Cutting The Deficit In Half. “The 2013 budget the president submitted today does not come close to meeting this promise of being reduced to $650 billion for fiscal year 2013. The president noted in that 2009 speech the Obama administration inherited a $1.3 trillion deficit. The deficit was similarly $1.3 trillion in 2011, is projected to be $1.15 trillion in 2012, and the president’s budget claims it will be $901 billion in 2013.” (Jack Tapper, “Obama’s Broken Deficit Promise,” ABC News, 2/13/12)
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Then I read a book by historian David Landes called The Wealth and Poverty of Nations. In it, he traces the rise and fall of the great civilizations in history. After about 500 pages of scholarly analysis, he concludes with this observation: “If we learn anything from the history of economic development, it is that culture makes all the difference.” Culture.
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Dodd-Frank is another example. It’s an 848-page behemoth that will be followed by thousands and thousands of pages of new regulations. Regulations are necessary. But burdensome regulations serve only to restrict freedom and imperil enterprise. The victims of those regulations are not nameless, faceless banks. They’re the employees, the business owners, and the customers who rely on those financial institutions.
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This administration’s burdensome regulations are even invading the freedom of everyday Americans. Mike and Chantell Sackett run a small business in Idaho. They saved enough money to buy a piece of property and build a modest home on it. But days after they broke ground, an EPA regulator told them to stop digging. The EPA said they were building on a wetland. But the Sacketts’ property isn’t on the wetlands register. It sits in a residential area.
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Under President Obama, those same bureaucrats are insinuating themselves into every corner of the economy. They prevent drilling rigs from going to work in the Gulf. They keep coal from being mined. They impede the reliable supply of natural gas. They even tell farmers what their 15-year-old sons and daughters can and can't do on the family farm.
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For centuries, the American Dream has meant the opportunity to build something new. Some of America’s greatest success stories are of people who started out with nothing but a good idea and a corner in their garage. Too often today, Americans look at what it takes to start a business and they don’t see promise and opportunity. They see government standing in their way.
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Freedom is becoming the victim of unbounded government appetite – and so is economic growth, job growth, and wage growth. As government takes more and more, there is less and less incentive to take risk, to invest, to innovate, and to hire.
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The proof is in this weak recovery. This administration thinks our economy is struggling because the stimulus was too small. The truth is we’re struggling because our government is too big.
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After the years of too many apologies and not enough jobs, historic drops in income and historic highs in gas prices, of a President who doesn’t hesitate to use all means necessary to force Obamacare on the American public but leads from behind in world affairs, it’s time to say, “Enough!”
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The American economy is fueled by freedom. Economic freedom is the only force that has consistently succeeded in lifting people out of poverty. It is the only principle that has ever created sustained prosperity.
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Under President Obama, bureaucrats prevent drilling rigs from going to work in the Gulf. They keep coal from being mined. They impede the reliable supply of natural gas. They even tell farmers what their 15-year-old sons and daughters can and can't do on the family farm.
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For centuries, the American Dream has meant the opportunity to build something new. Some of America’s greatest success stories are people who started out with nothing but a good idea and a corner in their garage. But today, Americans who want to start a new business or launch a new venture don’t see promise and opportunity. They see government standing in their way.
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The proof is in this weak recovery. This administration thinks our economy is struggling because the stimulus was too small. The truth is our economy is struggling because the government is too big.
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President Obama did not cause the recession, but he most certainly failed to lead the recovery. His stimulus protected the government, not the people. It was promised to hold unemployment below eight percent. It did not. Barack Obama’s stimulus was as ineffective as it was expensive.
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His Obamacare didn’t help create jobs either. It discouraged small businesses and health companies from hiring new workers. And Dodd-Frank hurt the community banks that provide loans to small businesses. But the “Too Big To Fail” banks are even bigger today.
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He failed to deliver on jobs, but on his goal to raise energy prices, he sure came through. All in all, President Obama prolonged the recession and slowed the recovery. His economic strategy is a bust.
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Instead of doing everything possible to promote the power of the free enterprise system to create jobs and get us out of this economic crisis, Barack Obama has promoted the power of government. The results have been predictably dismal, but he has “transformed” us, as he likes to say, closer to his vision of a Government-Centered Society.
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Today, government at all levels consumes 38 percent of the total economy or G.D.P. If Obamacare is allowed to stand, government will directly control almost half of the American economy. And through the increasing controls government has imposed on industries like energy and financial services, and automobiles, it will indirectly or directly control well over half of our total economy.
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In short, government must make America the best place in the world for entrepreneurs, innovators, small business and big business – for job creators of all kinds. Business is not the enemy. It is the friend of jobs, of rising wages, and of the revenues government needs to care for the poor and the elderly, and to provide for the national defense.
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Apple Computer and Microsoft weren’t started to save the world and neither were General Motors or Alcoa. Nor were some of the companies I helped start like Staples or The Sports Authority. All of these great American enterprises were started because innovators had great ideas and great ambitions. They became great commercial ventures, which is another way of saying they made a lot of money. Not just for a few people but for many people. They helped people buy homes, go to school, retire, start other companies.
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He never seemed to grasp the basic point that a plant closes when a business loses money. So today when the President attacks business and when his policies make it more difficult for businesses to grow and prosper, he is also attacking the very communities he wanted to help. That’s how it works in America. Or at least that’s how it works when America is working.
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The first three rules of any turnaround are focus, focus, and focus. But instead of focusing his attention on the economy, he delegated the stimulus to Nancy Pelosi and Harry Reid.
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President Obama’s answer to our economic crisis was more spending, more debt, and more government. By the end of his term in office, he will have added nearly as much public debt as all the prior Presidents combined. No President had ever run a trillion dollar deficit. The "New Normal" the President would have us embrace is trillion dollar deficits and eight percent unemployment.
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Seven months ago, I presented a detailed plan for jobs and economic growth, including 59 different proposals that would help strengthen the economy. I understand some people are amused that I have so many ideas. But I think the American people will prefer it to President Obama’s grand total of zero.
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Instead of picking winners and losers with taxpayer dollars, I will make sure that every entrepreneur gets a fair shot and that every business plays by the same rules. I will create an environment where our businesses and workers can compete and win. I will welcome the best and the brightest to our shores, and ensure that we have labor and training policies that help American workers to be more competitive.
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Dodd-Frank is another example of the President's attack on economic freedom. It’s an 848-page behemoth that will be followed by thousands and thousands of pages of new regulations. Regulations are necessary. But burdensome regulations serve only to restrict freedom and imperil enterprise. The victims of those regulations are not nameless, faceless banks. They’re the employees, the business owners, and the customers who rely on financial institutions that lose out.
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For centuries, the American Dream has meant the opportunity to build something new. Some of America’s greatest success stories are of people who started out with nothing but a good idea and a corner in their garage. Today, Americans look at what it takes to start a business and they don’t see promise and opportunity. They see government standing in their way.
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Freedom is the victim of unbounded government appetite – and so is economic growth, job growth, and wage growth. As government takes more and more, there is less and less incentive to take risk, to invest, to innovate, and to hire.
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But it’s not just health care. Mike and Chantell Sackett have seen firsthand how the Obama government interferes with personal freedom. They run a small business in Idaho. They saved enough money to buy a piece of property and build a home. But days after they broke ground, an EPA regulator told them to stop digging. The EPA said they were building on a wetland. But the Sackett’s property isn’t on the wetlands register. It sits in a residential area. Nevertheless, the EPA wouldn’t even let them appeal the decision. Fortunately, the Constitution confronted the Obama administration: the Supreme Court ruled unanimously for the Sacketts and against the Obama EPA.
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“And note that there are some differences in the campaign coming forward. Which is the President, our current president, is intent on raising tax rates, particularly for small business.” – Mitt Romney
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“And note that there are some differences in the campaign coming forward. Which is the President, our current president, is intent on raising tax rates, particularly for small business. Most small businesses are taxed at the individual tax rate—meaning they don’t pay a corporate tax, they pay individual tax rates and so he wants to raise the tax rates from 35 percent to 40 percent. That will impact a lot of small businesses and probably lead to some businesses having to lay people off. There’s another tax that he has proposed, and that is now in law, which is the Obamacare tax, which is applied to companies that make medical devices and instruments and so forth. And that tax is about 2.3 percent of your sales—not of your profit, but of your sales. And so that’s going to have a big impact on employers that are in the medical field, as you are. And then of course the Vice President the other day proposed another tax, which he said is a global tax on business. I’m not quite sure what that is, but that will surely cost jobs as well. And the President, of course, has been campaigning for something known as the Buffett Rule, the Buffett Tax. And I understand that was defeated in the Senate yesterday, so that’s probably not going to happen, but not a tax that had much of an impact. As a matter of fact, someone calculated that that tax would raise enough revenue to pay for government for eleven hours. So it was more of a gimmick than it was a real proposal to reform our tax system and make life a little easier. My own plan is to lower the tax rates, but also limit some of the deductions and exemptions and breaks, particularly for high income folks, so we can continue to get the revenue we’ve been getting – when I say we, I’m talking about the government – but can do so in a tax structure that’s simpler and with rates that are a little lower so that businesses can afford to hire and expand and people can have a little easier time making ends meet.”
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The President unfortunately ... has made it harder for new businesses to start up. As a matter of fact, the number of new business start-ups per year has dropped by 100,000 per year.
I’d say that you might have heard that I was successful in business. And that rumor is true. But you might not have heard that I became successful by helping start a business that grew from 10 people to hundreds of people. You might not have heard that our business helped start other businesses, like Staples and Sports Authority and a new steel mill and a learning center called Bright Horizons. And I’d tell you that not every business made it and there were good days and bad days, but every day was a lesson. And after 25 years, I know how to lead us out of this stagnant Obama economy and into a job-creating recovery!
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The liberals of the past raised taxes, often with little thought of how they would hurt small business, and the economy. Like them, President Obama proposes to raise the tax on small business. He wants to increase the marginal tax rate paid by the most successful small businesses from 35% to 40%. It's a throwback to discredited policies, and it will kill jobs.
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Julia progresses from cradle to grave, showing how government makes every good thing in her life possible. The weak economy, high unemployment, falling wages, rising gas prices, the national debt, the insolvency of entitlements – all these are fictionally assumed away in a cartoon that is produced by a president who wants us to forget about them.
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New and emerging small businesses and so-called gazelle, or fast-growing, businesses will spring up across the country by instituting pro-growth regulations, pro-growth taxes, pro-growth intellectual property protections, and pro-growth labor policies.
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There are some people here who are even more pleased than the graduates. Those would be the parents. Their years of prayers, devotion, and investment have added up to this joyful achievement. And with credit to Congressman Dick Armey: The American Dream is not owning your own home, it is getting your kids out of the home you own.
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That’s a theme for another day. But two observations. First, even though job opportunities are scarce in this economy, it is not for nothing that you have spent this time preparing. Jerry Falwell, Senior, long ago observed that “You do not determine a man’s greatness by his talent or wealth, as the world does, but rather by what it takes to discourage him.” America needs your skill and talent. If we take the right course, we will see a resurgence in the American economy that will surprise the world, and that will open new doors of opportunity for those who are prepared as you are.
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Today, government at all levels consumes 37 percent of the total economy or G.D.P. If Obamacare is allowed to stand, government will reach half of the American economy. And through the increasing controls government has imposed on industries like energy, financial services and automobiles, it will soon effectively control the majority of our economic activity.
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Instead of throwing more borrowed money at bad ideas, I will lower tax rates, simplify the tax code, and get the American economy running at full strength.
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Now this morning, the President had a press conference. I don’t know if you heard it, but he called a press conference and pulled people in and said a number of things, and one of the most interesting things he said was this: he said the private sector is doing fine. He said the private sector is doing fine. Is he really that out of touch? I think he’s defining what it means to be detached and out of touch with the American people. Has there ever been an American president who is so far from reality as to believe in an America where 23 million Americans are out of work, or stopped looking for work, or can only find part-time jobs and need full-time jobs, where the economy grew in the first quarter of the year at only 1.9 percent, where the median income in America has dropped by 10% over the last four years, where there have been record number of home foreclosures, for the President of the United States to stand up and say the private sector is doing fine is going to go down in history. It's an extraordinary miscalculation and misunderstanding by a President who is out of touch, and we're going to take back this country and get America working again.
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Now, I know the President will say that he inherited an economic crisis. But we shouldn’t allow the challenges he faced four years ago to divert our attention from another important fact: The President pursued policies that have made this the slowest recovery since the Great Depression. And he broke promises many were counting on to build a brighter future.
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Just compare this President’s record with Ronald Reagan’s first term. President Reagan also faced an economic crisis. In fact, in 1982, the unemployment rate peaked at nearly 11 percent. But in the two years that followed, he delivered a true recovery – economic growth and job creation were three times higher than in the Obama Economy.
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We know our economy can’t grow if we’re mortgaging our future to pay for the big government programs of today. As President, I will rein in spending and balance the budget. And I will repeal Obamacare. We cannot afford another $2 trillion entitlement. Obamacare depresses job growth. In one study, 73 percent of business owners said that Obamacare has made it harder for them to hire people. Repealing Obamacare and replacing it will give businesses the certainty they need to hire, expand, and grow.
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Immigration reform is not just a moral imperative, but an economic necessity as well. Immigrants with advanced degrees start companies, create jobs, and drive innovation at a high rate. Immigrants founded or cofounded nearly half of our 50 top venture-backed companies. They are nearly 30 percent more likely to start a business. And that kind of risk taking is something we need more than ever because new business starts are now at a 30-year low.
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And finally and perhaps most importantly, I will restore economic freedom. This nation’s economy runs on freedom, on opportunity, on entrepreneurs, on dreamers who innovate and build businesses. These entrepreneurs are being crushed by high taxation, burdensome regulation, hostile regulators, excessive healthcare costs, and destructive labor policies. I will work to make America the best place in the world for innovators and entrepreneurs and businesses small and large.
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Today the National Federation of Independent Businesses, NFIB, they announced a study they'd carried out. They talked to their members and had some economists trying to understand what would happen if the President's tax policies actually were enacted because his tax policy is to take the tax on small business from 35 percent to 40 percent. I say that because most small businesses are taxed as individuals and he wants to raise the marginal tax rate from 35 to 40 percent and the NFIB came back with a number. They said if that policy gets put in place, it will kill 710,000 jobs. That's the direction of this President. And there’s something else, I think, that you ought to know. And that is when something’s in trouble, when people need good jobs, you would think the President would focus all of his energy and his passion on helping people get jobs. But you know what he’s been doing over the last six months? In the last six months, he has held 100 fundraisers. And guess how many meetings he’s had with his Jobs Council? None. Zero. Zero, in the last six months. So it makes it very clear where his priorities are. His priority is not creating jobs for you, his priority is trying to keep his own job and that's why he's going to lose it.
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Paul and I have a positive agenda that will lead to economic growth, to widespread and shared prosperity that will improve the lives of our fellow citizens. Our Plan For A Stronger Middle Class will get America back to work and get our country back on track.
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Fifth, we will champion small business. Unlike President Obama, I won't raise taxes on small business. I'll make sure regulators protect the public, but that they stop killing our jobs. I will remove the crippling uncertainty that is preventing businesses from hiring.
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If we focus on these five areas – energy, education, trade, deficits, and championing small business – America’s economy will come roaring back to life. And we will finally see a comeback for America’s middle class.
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