WRAPUP 8-Obama touts investment plan on middle America trip

Wed Jan 26, 2011 5:13pm EST

* Obama makes trip to Wisconsin to sell his ideas

* Says U.S. must invest in technology, clean energy

* In State of the Union, he seeks 5-year spending freeze

* Republicans say Obama did not go far enough (Adds joint statement from business, labor groups)

By Ross Colvin

MANITOWOC, Wisc., Jan 26 (Reuters) - President Barack Obama pressed his case on Wednesday for investment to grow the U.S. economy out of its budget woes, a job made tougher by a forecast that the deficit will surge 40 percent this year.

The Congressional Budget Office forecast the U.S. deficit would hit $1.48 trillion this year and the Federal Reserve was downbeat on the prospects for job creation. [ID:nN25283937]

Those were sobering reminders the day after Obama's State of the Union address, in which he struck a conciliatory tone toward newly empowered congressional Republicans and advocated investment in some areas and cuts in others to make the U.S. economy more competitive.

Obama's retooled, business-friendly approach is aimed at moving to the political center, which is key to his 2012 re-election chances.

Stock and oil prices gained on optimism over Obama's offer to cut corporate tax and curb spending. [ID:nN26161108]

On a trip to Wisconsin, a political battleground state he won in the 2008 election, Obama pushed his message of innovation and job creation during a visit to renewable energy firm Orion Energy Systems in Manitowoc.

To hold its own against rising powers like China and India, the United States should be "winning the future" by investing in high technology, Obama said.

"China's making these investments and they have already captured a big chunk of the solar market, partly because we fell down on the job. We weren't moving as fast as we should have. Those are jobs that could be created right here that are getting shipped overseas," Obama told workers.


Full coverage of Obama's speech [ID:nSOTUS]

Breakingviews-Obama's tax reforms [ID:nLDE70P1ZV]

Graphics r.reuters.com/cem67r

Reuters Insider link.reuters.com/nuv67r



Republicans, who routed Obama's Democrats in November congressional elections, said he did not go far enough in his speech to embrace fiscal restraint. Obama will have a fight on his hands over his budget plan to be presented in February.

In an effort to show fiscal discipline, Obama proposed a five-year freeze in some domestic spending, which he said would cut $400 billion from budget deficits over a decade.


He alluded again on Wednesday to the need to cut spending, saying progress meant "doing what we try to do in our own lives by taking responsibility for our deficits by cutting wasteful, excessive spending wherever we find it."

Republicans seeking $100 billion in deficit cuts this year to try to move the United States to a sounder fiscal footing, called Obama's planned spending freeze too little, too late.

"There's got to be some kind of absolute iron-clad path to getting (spending) down," Republican Senator John McCain said on ABC's "Good Morning America" program.

Obama walked a fine line in Tuesday's speech.

"Basically, what I heard were a lot of ideas to raise spending followed by ideas to cut spending. You can't have it both ways," said Bryan Hofferica, 32, who works at a brokerage house in Chicago.

Obama offered some proposals that might appeal to the Republicans, who control the House of Representatives. These include a corporate tax cut, while closing existing loopholes, and reform of the tax code. He also threatened to veto lawmakers' pet spending projects.

Leaders of lobby groups representing business and labor -- the U.S. Chamber of Commerce and the AFL-CIO -- issued a rare joint statement applauding Obama's proposals for projects that would create jobs.

"Whether it is building roads, bridges, high-speed broadband, energy systems and schools, these projects not only create jobs and demand for businesses, they are an investment in building the modern infrastructure our country needs to compete in a global economy," the statement said.

"We hope that Democrats and Republicans in Congress will also join together to build America's infrastructure."

Republicans have threatened to obstruct efforts in Congress to raise the national debt ceiling by the time it hits a statutory limit of $14.3 trillion by March 31. The country could default on its debt, causing financial havoc, if the limit is not increased.

Republican insistence on maintaining tax cuts even for the richest Americans is complicating Obama's attempt to close the fiscal gap.

Obama sought in his speech to reassure Americans weary of stubbornly high 9.4 percent unemployment, fearful of rising debt and dismayed at vicious political rhetoric.

The challenge will be how to finance investment for growth while addressing a dire fiscal outlook. On this Obama left details until his budget, due next month.

The new Republican chairman of the House Armed Services Committee criticized the Obama administration's plan to strip tens of billions of dollars from the Pentagon's budget and suggested that national security considerations may have been sacrificed. [ID:nN26125400]

At the World Economic Forum in Davos, business leaders gave a mixed reaction to Obama's proposed austerity steps, with some questioning whether they go far enough. [ID:nLDE70P0QW]

"American corporates and Western corporates are really uncertain, and I don't think last night's speech really gets us further in terms of removing that uncertainty," Martin Sorrell, CEO of advertising giant WPP, told a panel. (Additional reporting by David Morgan, Alister Bull, Jeff Mason, Matt Spetalnick, and Patricia Zengerle in Washington and Andrew Stern in Chicago; Editing by Will Dunham and Christopher Wilson)

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Comments (1)
Brittanicus wrote:
Not much was said in the open sequence of President Obama’s State of the Union speech, relating to the mass invasion of illegal invaders. He described the crash of the Dream Act not being enacted, but nothing about the undercurrent of who pays for it, or immigration law allowing millions of more family members entering under the Chain Migration sponsorship. My attitude on illegal immigration doesn’t really matter as a blogger, however my deep rooted investigation of the truth does? There are hundreds of authentic reports on the Internet with a reality view of Congressional spending that includes States. Politicians like Sen. Harry Reid are the main cause of this nation’s demise through catering to the occupation of foreign intruders and stifling the use of a mandatory E-Verify employee verification program. These reports and articles come from not only Liberal sources, but the commercial and government archives. The American people complain all the time about the porous border, the Dream Act, Amnesty, Sanctuary cities and the mass emergence that are straining our welfare system for the instant citizenship of babies of illegal parents. Sanctuary states like California are truly in a terrible way, because the Sacramento Lib-Democrats have done nothing to stop welfare fraud and financial support of illegal immigrants.

In the past two years, as unemployment remained near 10 percent, more than 1 million immigrants, of whom 35 percent were undocumented or illegal, have gotten work in this country. The story is that in the past two years, U.S. business owners have chosen to go for discount immigrant help, while the economy as a hole has shed millions of jobs for U.S. workers. California has a 26 billion dollar drain in this once flourishing state, caused by the malfunction of ICE and homeland Security to remove the infestation of illegal families. The Federation for American Immigration Reform estimates that the cost of illegal immigration to the states stands at about $113 billion, with nearly half that amount going to education costs. It’s easily explained as one illegal worker slips past the border patrol, rents a home and then the whole family comes over the border. Then there is the problem with entry via a tourist or student visa, but with no intentions to return to their nation of birth.

The main culprits in entitlement programs are education for infants through k-12, the birthright citizenship law of the 14th amendment, the free hospital emergency room that has become a visit for sore throats and common flue. These subsidizing public services are by no means the limit to pandering to the illegal immigration invasion. Another massive disbursement is the criminal sewer rats, which also have made their way from our Southern border and even European countries. Last week, the Los Angeles County supervisor , Michael Antonovich, , released new statistics showing welfare costs for the children of illegal immigrants cost the county $600 million last year, up from $570 million in 2009, as reported by Fox News. Going beyond the cost of food stamps and welfare-style benefits through the state program CalWORKS to include the expenses of public safety and health care, the total cost for illegal immigrants to Los Angeles taxpayers for 2010 was more than $1.6 billion, not including education costs. Last week, the California Department of Education released data demonstrating that for the first time Latinos now make up the majority of California’s public school students, cracking the 50 percent barrier for the first time in state history, the San Francisco Chronicle reported.

Illegal aliens are reducing the retirement payments, pensions to our old folk. At http://www.rense.com/general79/seniors.htm According to the Journal of American Physicians and Surgeons Volume 10 Number 1 spring 2005 (the report on Illegal Aliens and American medicine) http://www.jpands.org/vol10no1/cosman.pdf defines the issue as a monolithic non-reimbursement concern of hurting hospitals across the United States. Illegal aliens are costing more than the prior Iraqi war as seen here, http://www.rense.com/general80/mroe.htm There reports are just the tip of the iceberg. Removing illegal immigrants from America that we are feeding, housing and giving free hospital access, would go a very long way in saving bankruptcies in state treasuries and the federal failure of placing American taxpayers before nationals of other corrupt countries. Call your Senator or politician about illegal Immigration, and Amnesty at Washington switchboard to be connected at 202-224-3121.

Jan 26, 2011 12:52am EST  --  Report as abuse
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