WASHINGTON -- President Barack Obama used an election-year State of the Union address Tuesday night to frame the national debate not as a referendum on him but as a pivotal decision on how to save the American dream.
He boasted that the economy has improved, albeit slowly, from the depths of the Great Recession. "The state of our union is getting stronger," he said.
But he said the middle class has been losing ground for decades, and he urged a new agenda of taxes and government spending to tilt the playing field away from the rich and powerful and more toward the rest of the citizenry.
Once, he said, Americans believed "the basic American promise that if you worked hard, you could do well enough to raise a family, own a home, send your kids to college, and put a little away for retirement. The defining issue of our time is how to keep that promise alive."
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Among his proposals: a 30 percent minimum tax on millionaires, a minimum tax on companies that ship jobs overseas coupled with tax cuts for those that keep factory jobs at home, expanded domestic natural gas drilling, and a $200 billion, six-year plan to build roads, bridges and railways with money saved from scaling back the wars in Afghanistan and Iraq.
Obama opened his speech declaring victory in bringing troops home from Iraq, eliminating Osama bin Laden and beginning to withdraw troops from Afghanistan. That enables the country, he said, to "think about the America within our reach."
Republicans countered with a similar vision of a more prosperous America where everyone shares the bounty. But they offered a far different agenda and castigated Obama for policies they said have made things worse.
"As Republicans our first concern is for those waiting tonight to begin or resume the climb up life's ladder," said Gov. Mitch Daniels of Indiana, giving the official Republican response. "We do not accept that ours will ever be a nation of haves and have-nots. We must always be a nation of haves and soon to haves."
Obama insisted that his agenda is what's needed to put the country back on track.
"Millions of Americans who work hard and play by the rules every day deserve a government and a financial system that does the same," he said. "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."
Under the broad theme of helping build a fairer economy, Obama laid out proposals in four categories: helping restore U.S. manufacturing, improving U.S. energy independence, teaching workers new skills for a changing economy, and increasing taxes in what he called "a renewal of American values."
He proposed that millionaires pay a minimum tax of 30 percent, putting a precise number to the idea he proposed last year. The proposal comes as Republicans vying for his job all have proposed cutting taxes for the wealthy, arguing that they are the ones who create jobs.
Obama's proposed tax rate would double the income taxes paid by one of those candidates. Mitt Romney has revealed that he made $20.9 million last year and expects to pay $3.2 million in taxes, a 15.4 percent tax rate.
Administration officials said Obama's 30 percent proposal was in the works for several weeks and had nothing to do with Romney.
Obama also vowed ever more oversight of Wall Street, saying he had directed Attorney General Eric Holder to create a Financial Crimes Unit to investigate and prosecute large-scale financial fraud.
He boasted that manufacturing -- for a century the steppingstone of upward mobility -- is adding jobs for the first time in more than a decade.
To help more, he proposed tilting the tax code to push companies to open factories here rather than overseas. He urged lowering the corporate tax rate for businesses that manufacture and create jobs in the United States. He also proposed higher taxes for companies that export jobs overseas.
To help the working class, he proposed:
Partnerships with community colleges and businesses to train and place 2 million workers.
Overhauling the unemployment compensation program that provides checks to laid-off workers, linking the aid to training.
Getting all states to require students to stay in school until they graduate or reach 18, as 20 states do now.
To ease the housing crisis, Obama said he'll send Congress a new plan that would help homeowners who are current on their payments save $3,000 a year by refinancing their mortgage. The program would be paid for with a new bank fee he has proposed.
Obama spent most of the hour-plus speech on domestic issues, which dominate the public's priority list. Late in his oration, he noted the "wave of change" sweeping across the Middle East and North Africa.
Turning to Iran, he said the world has united in opposition to the regime's work toward a nuclear weapon.
"Let there be no doubt," he said. "America is determined to prevent Iran from getting a nuclear weapon, and I will take no options off the table to achieve that goal."
Obama looked out on a Congress where Republicans control the House of Representatives and have ruled out most of his proposals, particularly tax increases for the wealthy.
"As long as I'm president, I will work with anyone in this chamber," Obama said. "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.
"We will not go back to an economy weakened by outsourcing, bad debt and phony financial profits."