Town Hall Gets Personal For Obama

President Barack Obama defended his economic program in starkly personal terms Monday after coming face-to-face with supporters who said, bluntly, that he had let them down.

The first two questioners from the audience at a live CNBC town hall meeting both expressed a sense of personal disappointment with Obama, with one man asking, “Is the American Dream dead?” And CNBC’s moderator John Harwood asked Obama whether his elite education, personal style and “racial heritage” might make it hard for average Americans to believe that he is feeling their suffering.

“I think when unemployment is high and people are having a tough time it doesn’t matter if I was green, it doesn’t matter if I was purple, people would still be frustrated and understandably so,” Obama said. “The whole reason I ran was because my life is a testament to the American dream.”

Obama sought to use his own narrative as the child of a single mother to push back against the notion that he is out of touch with the middle class.

One audience member, a chief financial officer with two children soon to go to college, said she was afraid her “new reality” would including struggling just to keep decent food on the table. “I’ve been told that I voted for a man who was going to change things for the middle class, . . .and I’m waiting sir, I don’t feel it yet,” she said.

“Times are tough for everybody right now. I understand your frustration,” Obama responded, adding that new consumer protection rules on things like mortgages and credit cards would help the middle class as would tax breaks for small businesses that create new jobs.

Another audience member, a young public interest lawyer, said he was “really inspired by you and your campaign and the message you brought, and that inspiration is dying away, and it feels like the American dream is moving away from us. . . .Is the American dream dead?”
"Absolutely not,” Obama said. “There is not a country in the world that would not want to change places with us for all the problems we have got.”

In his answer to the lawyer and others, Obama returned to his argument that he inherited an economy laid low by 10 years of bad decision-making and that his policies headed off an even deeper recession, and now are turning things around, but acknowledged it was happening more slowly than anyone would like.

“What we saw happening during 2001 till the time I took office was wages actually declining for middle class families, people treading water, young people having trouble getting their foot in the door in terms of businesses. We are now having to go back to the fundamentals of what made America great and that means that we have to make sure that our markets are working in a way that is good for a broad base of people and not just a narrow base of people,” Obama said.


At another point, he said, “It’s slow and steady as opposed to the kind of quick fix that I think a lot of people would like to see, but. . .it took us a decade to get into the problem we’re in right now.”

Obama also sought to rebut the argument from business leaders that he is hostile to private industry.

Asked if he distrusted the profit motive, as many business leaders believe, Obama said that was “absolutely not” the case, adding that “modest reforms” such as those he has supported are often initially resisted.

He cited the creation of the FDIC as one example of a reform initial strongly resisted by the financial industry. He also repeatedly cited the multiple tax breaks Congress has passed for small business as well as new proposals he has put forward to reduce taxes on research and development as examples of his “pro-business agenda.”

Obama said he had not made any final decisions about his economic team staying on after a midterm election in which Democrats are expected to lose the House of Representatives. But he added that Treasury Secretary Timothy Geithner and National Economic Council Chairman Larry Summers and other members of the team are doing “an outstanding job.”

But he added that “decisions about family” would in part determine how many members of the economic team stay after the midterms.

The president once again firmly opposed extending the Bush administration tax cuts on the wealthiest two percent of earners who make over $200,000 for individuals or $250,000 for families. Some moderate Democrats in Congress have taken the opposite stance, saying that all the tax cuts should remain in place while the economy remains weak.

“I’m speaking against my own financial interests here. It’s an irresponsible thing for us to do. Those folks are least likely to spend it,” Obama said.

Obama added, “I can’t give tax cuts to the top 2 percent of Americans, 86 percent of which would go to people making a million dollars or more, and lower the deficit at the same time. I don’t have the math. I would love to do it. Anybody in elected office would love nothing more than to give everyone tax cuts.”

Obama also made a strong push for his proposed new $50 billion infrastructure spending plan. "China spends 9 percent [of GDP] on infrastructure, we are spending 2 percent, which is why are roads are so messed up."

But in a nod to those who say the plan is not big enough, Obama said there was "no free lunch" on spending and that decisions have to be balanced against the rising federal deficit.

Obama had some tough words for China, arguing that its policy of keeping its currency artificially low is doing significant damage to the U.S. economy. "You can't just sell to us and we can't sell to you," he said. "We have been bringing more actions against China before the WTO and we are going to enforce our trade laws much more effectively." He added, "I am pro-trade. I just want to make sure trade is good for American business and American workers.”