Facing economic crisis, President Obama calls for new stimulative efforts

WASHINGTON — President Obama urged the nation Tuesday night to see the economic crisis as reason to raise its ambitions, calling for expensive new efforts to address energy, health-care and education programs even as he warned that more money might be needed to bail out banks.

In his first address to a joint session of Congress, Obama mixed an acknowledgment of the depth of the economic problems with a Reaganesque exhortation to American resilience and an expansive agenda with a pledge to begin paring down a soaring budget deficit.

"While our economy may be weakened and our confidence shaken, though we are living through difficult and uncertain times, tonight I want every American to know this," Obama said. "We will rebuild, we will recover, and the United States of America will emerge stronger than before."

He was greeted in the House chamber with gregarious applause, particularly from Democrats who hold a strong majority. Yet even Republicans leaned in close to Obama as he passed by them in the narrow aisle and made his way to the speaker's dais at the front of the room.

Obama said he came to the Capitol not only to address House and Senate members who were seated before him, but also to "speak frankly and directly to the men and women who sent us here."

"If we're honest with ourselves, we'll admit that for too long, we have not always met these responsibilities — as a government or as a people," Obama said. "I say this not to lay blame or look backward, but because it is only by understanding how we arrived at this moment that we'll be able to lift ourselves out of this predicament."

A failure to confront the nation's dependence on foreign oil, deal with the rising cost of health care or find a solution to the decline of schools contributed to the place the country finds itself in, Obama said. He renewed his call for investments in all areas, particularly finding a way to create energy resources that do not rely on foreign sources of oil.

Greenhouse gases

Obama, following through on a campaign pledge, challenged Congress to pass a bill to cap greenhouse-gas emissions that are heating the planet and use $15 billion a year of the revenues from the program to pay for renewable sources of energy.

He said America was falling behind China, Germany, Japan and other nations in production and use of clean energy, but challenged U.S. entrepreneurs to develop technology to make the United States a global leader in energy efficiency.

He was vague about how he intends to make health care more affordable and accessible, saying only that the budget he will release Thursday will make a down payment on the goal of "quality, affordable health care for every American."

On the campaign trail, he committed himself to many goals, including establishing a public insurance program to compete with private insurers, requiring employers to contribute to the cost of coverage for their employees or to the cost of the public plan and requiring that all children have coverage.

Obama said he would cut the deficit in half by the end of his first term, telling his audience for the first time that his administration has "already identified 2 trillion dollars in savings over the next decade."

In an interview, an administration official said those savings reflected reduced spending on the Iraq war and higher revenues from letting the Bush administration's tax cuts for the wealthiest Americans lapse after 2010.

In his litany of proposals, Obama called for creating tax-free universal savings accounts for all Americans, a nod to Republicans to create investment vehicles as they consider overhauling the Social Security program.

"My budget does not attempt to solve every problem or address every issue. It reflects the stark reality of what we've inherited — a trillion-dollar budget deficit, a financial crisis and a costly recession," Obama said. "Given these realities, everyone in this chamber — Democrats and Republicans — will have to sacrifice some worthy priorities for which there are no dollars. And that includes me."

Anger acknowledged

Although Americans have been seeing a lot of Obama in the first 36 days of his presidency, the speech Tuesday night gave him an opportunity to command the stage in a way he had not yet done and served as an early test of whether he will be able to persuade Republicans to support any pieces of his agenda.

Republican leaders in the House and Senate turned to a rising voice outside Washington, D.C., to respond to the address.

Louisiana Gov. Bobby Jindal said Republicans also were focused on rebuilding the economy, but he criticized Democrats for turning to government programs — and spending.

"Democratic leaders say their legislation will grow the economy," Jindal said. "What it will do is grow the government, increase our taxes down the line, and saddle future generations with debt. Who among us would ask our children for a loan, so we could spend money we do not have, on things we do not need? That is precisely what the Democrats in Congress just did. It's irresponsible."

Obama acknowledged the anger felt by many Americans over the bailouts of banks, the automobile companies and homeowners who are in over their heads. But he made a case that all those steps were necessary, not to help the institutions or people receiving taxpayer money, but to avert deeper economic problems that would afflict everyone for years to come.

At a time of crisis, he said, "we cannot afford to govern out of anger, or yield to the politics of the moment."

Obama sought to explain the program he announced last week to help some homeowners prevent foreclosure. He asked for understanding from Americans who have made their payments on time and who regard the bailout plan as an unfair reward to those who lived beyond their means. The president urged Americans to consider refinancing their homes, which he said could save nearly $2,000 on their mortgages.

On health care, Obama said, "Let there be no doubt: Health-care reform cannot wait, it must not wait, and it will not wait another year."

The president waited until the last moments of his speech to address America's relations with the world.

He pledged to end the Iraq war, defeat al-Qaida and combat extremism in Afghanistan and Pakistan. He did not say how, leaving details to pending reviews under way on both Iraq and Afghanistan policy.