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Prior to the August congressional recess and looming government budget wrangles, U.S. President Barack Obama embarked on a string of campaign-style speeches focusing on economy and tax reforms, but he has failed so far to persuade GOP rivals to offer him an olive branch.
Stump speeches
During his Tuesday speech in Chattanooga, U.S. state of Tennessee, Obama proposed a policy framework to help break through the political logjam in Washington, facilitate corporate tax reforms and spur job creation in the world's largest economy.
Obama has put forward policy proposals to strengthen the middle class in recent speeches and tries to make the case "as best as we can," White House top economic adviser Alan Krueger said on Monday at a luncheon event in Washington.
However, like similar stump speeches in Illinois, Missouri and Florida last week, Obama Tuesday did not unveil many new messages other than reemphasizing the policy priorities including more infrastructure projects and education spending outlined in his State of the Union address in February.
"Let's put more construction workers back on the job doing the work America needs done," Obama's latest push sounded familiar.
"There's still more than a year before the next mid-term elections, and so this time presents about as good a window for making progress on these issues as the president is going to get," Benjamin Friedman, a professor at Harvard University, told Xinhua.
Obama was right to call for increased investments in needed upgrades, and the Congress should consider one of the numerous bills that have proposed an infrastructure bank to help support those costs. It would help to create good jobs now and make America a more competitive nation in the future, William Galston, a Senior Fellow at Brookings Institution and Korin Davis, a Project Manager of the think tank, said in a jointly written article.
"Public coffers are strained at the federal and state levels, but by neglecting to invest in our infrastructure we would be undermining our future competitiveness," they contended.
Improving economy
Experts held that Obama's recent speeches also aimed at giving himself credit for the improving economy on the back of a housing sector recovery, despite a still high unemployment rate hovering at 7.6 percent.
"Today, our businesses have created 7.2 million new jobs over the last 40 months. This year, we're off to our best private-sector job growth since 1999. We now sell more products made in America to the rest of the world than ever before," Obama touted Tuesday.
The recovery from the downturn triggered by the recent financial crisis was about on the pace one would have expected. Unemployment remained disappointedly high, but production has long since recovered fully from the downturn, and both business profits and the stock market were at record highs, Friedman noted.
The fastest moving areas were the recoveries in home-building and automobile production and sales. Oddly, the greatest drag on the economy is the combination of contraction in government spending and increasing taxes. "For a while yet to come, I think the economy can benefit from continuing expansion in monetary policy, and less contractionary fiscal policy would be a help too," Friedman contended.
Roughly 85 billion U.S. dollars of spending cuts, or "sequester" in U.S. government budget language, hit various governmental departments this year starting on March 1. A latest study from U.S. Congressional Budget Office (CBO) revealed that getting rid of the sequester would add about 900,000 jobs in 2014. The recent jittery financial markets also reflected concerns over a possible earlier-than-expected exit from U.S. Federal Reserve's monetary stimulus.
Tax reform
Obama also used the trip to press Republicans to accept his corporate tax reform plan, first proposed last year. "I'm willing to simplify our tax code -- closes those loopholes, ends incentives to ship jobs overseas, lowers the rate for businesses that are creating jobs right here in America, provides tax incentives for manufacturers that bring jobs home to the United States," Obama said during his visit to a Amazon.com plant in Chattanooga.
But Obama's GOP rivals including U.S. House Speaker John Boehner seemed unimpressed by his latest pitch and corporate-only tax reform plan.
"The President has always supported corporate tax reform. Republicans want to help families and small businesses, too. This proposal allows President Obama to support President Obama's position on taxes and President Obama's position on spending, while leaving small businesses and American families behind," Michael Steel, spokesman for the top GOP lawmaker, said Tuesday in a statement.
"We have always said corporate tax reform must be paired with individual tax reform, so that families and small businesses are not left behind," said another senior House GOP Leadership aide, adding that Democrats wanted to raise tens of billions of dollars in additional revenue through the corporate tax reform, which is the opposite of a concession.
The Obama administration urged lowering U.S. top corporate tax rate from 35 percent to 28 percent, with an even lower tax rate of no higher than 25 percent for manufacturers. Republicans called for even deeper tax cuts for businesses. Obama's presidential election opponent, Mitt Romney, last year proposed a 25 percent top corporate tax rate for all companies.
Debt ceiling
U.S. federal government shutdown odds are rising recently, as the differences in the two parties' budget plans for the 2014 fiscal year starting on October 1 remained too far for an easy deal. Some Republican lawmakers vowed to shut down the White House this fall unless Obama agrees to defund the implementation of Obamacare, his signature legislation passed in 2010.
"We've seen a certain faction of Republicans in Congress hurt a fragile recovery by saying that they wouldn't pay the very bills that Congress racked up in the first place, threatening to shut down the people's government if they can't get rid of Obamacare," Obama charged Tuesday.
Analysts believed that Obama was endeavoring to win key legislative battles on immigration, the budget fight for the next fiscal year and raising the government's debt ceiling. He also intended to use the public speeches to cast GOP lawmakers as obstructionists.
"Obama is probably trying to focus public attention on the economy in advance of this fall's budget discussions. If the Congressional Republicans are going to threaten to shut down the government, or force a default on the U.S. public debt, he would no doubt like to have public opinion squarely focused on what they're doing," Friedman said.
Earlier this week, Krueger also urged congressional leaders to raise the federal government's debt ceiling without drama this fall, warning that it would be a disaster for the financial sector if the United States crosses its debt limit.
In recent years, U.S. lawmakers always wait until the last minute to raise the federal government's borrowing capacity, casting uncertainty on U.S. pledge to honor its obligations. Global rating agency Standard & Poor's decision to strip the nation of its gold-plated credit rating in 2011 sounded a warning alarm on the effectiveness of the Beltway political system to manage U.S. mounting public debt of nearly 17 trillion dollars.
