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President Obama Speaks from Galesburg, Illinois

Aired July 24, 2013 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

SUZANNE MALVEAUX, CNN ANCHOR: You're watching CNN. I'm Suzanne Malveaux. President Obama tries to turn the country's attention back to the economy. We'll hear from the president shortly from the campus of Knox College. This is in Galesburg, Illinois. We'll bring you his remarks live. You're looking at live pictures there. It is going to happen momentarily.

This is a first of a series of speeches on the economy. I want to bring in our team following this: Jessica Yellin, Wolf Blitzer, Gloria Borger, Christine Romans, all for a preview here.

Jessica, I want to start off with you at the White House there. We don't expect any new policy initiatives here. And it really is a focus, a pivot, a vision speech, if you will.

What do we expect to hear from the president today?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: You can expect the president to talk about first briefly what he's accomplished since he came into office, bringing the United States out of the financial crisis, but a heavy focus on what he'd like to see accomplished ahead for his second term and even beyond.

So you could think of this as a legacy defining speech, a legacy setting speech with the president trying to pitch forward and prod Congress into action in part by taking a two-by-four to Republicans and saying if there is no action it's because Congress is gridlocked.

And he's taking his case to the American people. I think you'll hear a very strong defense of ObamaCare with the expectation, Suzanne, that he knows House Republicans will try to repeal ObamaCare as part of a deal to raise the debt ceiling and the president drawing a bright line soon, saying that's a no-go, Suzanne.

MALVEAUX: We'll talk about more on that in just a minute. But I want to bring Christine into the conversation.

Talk about the state of the economy here, because we are in a recovery. Wall Street's basically back in record territory. There is some rebounding with housing prices.

Despite some of the good indicators here, there are still people who are not feeling this. They're not feeling the recovery.

How does the president reach them and tell them, make them understand that he gets this? CHRISTINE ROMANS, CNN ANCHOR: Yes. And that's a really fine line the president has to walk. You want to have confidence, you want to tell people look, records again and again in the stock market. The stock market is putting wealth in 401(k)s of working Americans.

The housing market is getting better. You know, you're seeing all of these signs of slow healing growth in the labor market, 200,000 jobs on average a month created so far this year.

But you have to be so careful because the middle class knows that those jobs are being created. Not all of them are the same quality of job that we lost, especially when you're talking about right there where Maytag used to be such an important employer there.

Those jobs went overseas and now many of those workers are making much less money than they did when they were fully employed a decade ago. So he has to be so careful about that. Some people are still underwater. First-time home buyers, by the way, on their homes are only 30 percent of the market. Usually it's more like 40 percent.

So first-time home buyers, they are not able to get in at the price they want or can't get a mortgage. So he's got to be confident, but at the same time, not overly confident because Republicans will hammer him on that. They'll point out that --

MALVEAUX: All right.

ROMANS: -- you've got an underemployment rate like 14 percent -- too high.

MALVEAUX: OK.

Gloria, let's talk about the president's agenda because one of the things that Jessica mentioned as well is he's going to be talking about ObamaCare but he's also been pushing for immigration reform, really trying to get that through Congress here.

Do you think that he's going to try to tie that into the economy, the state of the economy, saying look, you know, legalize 11 million folks here, allow them to become citizens. Perhaps that will be a boost to the economy.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Yes, he will. He'll talk about it as a boost to the economy. He's also going to say that it will make your health care cheaper because you'll have more people buying into these insurance pools.

So I think he's going to relate everything back to the economy, most of all reminding people that a lot of progress has been made, because right now he's confronting an American public where only a third believe that we're on the right economic path.

So he has to sort of remind people actually things are getting better. And if you stick with me on my economic plan heading into the fights in the fall over the budget, raising the debt ceiling, if you stick with me, things will continue to get better for you. MALVEAUX: Wolf, break it down for us if you will, because obviously he's going to be fighting again the issue of the debt ceiling. The budget, they're still very far apart when it comes to 2041. He's clearly looking to his economic legacy as well.

What does he need to say? What does he need to do in the next couple of years to really make that happen?

WOLF BLITZER, CNN HOST: He's got to remind the American people. And we'll see that today dramatically in his speech. He's got to remind them where the country was during the Great Recession, as you will, back in 2008, 2009 right after -- right when he took office.

The country was teetering at that moment. There could have been a depression. He's going to remind people of the progress that's been made over the past 4.5 years.

But he's going to say there's still a long, long way to go. And there may be jobs. There may be 200,000 jobs created a month, as Christine just suggested, and that's all true. But as she also pointed out, that a lot of these jobs, these jobs that have been created, pay so much less than these folks used to make.

If somebody was making $85,000 or $90,000 a year a few years ago, they may accept a job for $45,000 or $50,000 a year now because they have to put food on the table and they got to pay the bills. So they're not where they were but it's better than being unemployed, if you will. And there are a lot of people in that category.

He's going to try to give a balanced assessment. There's an enormous amount of work. But he's going to go after those Republicans, especially in the House of Representatives, who he says are going to block him virtually every step of the way. Even though there will be cooperation on a bipartisan level with a lot of Republicans in the Senate, especially on immigration.

MALVEAUX: Jessica, you also mentioned as well, you talked about ObamaCare, implementing ObamaCare and how important that is. But also he deals with this argument, the debt and the debt ceiling debate.

I mean, the last go-around, that happened 2011, it was a disaster. You had the credit rating of the United States downgraded. He's likely to have to face that same debate in October or November.

Is he going to address anything here that really sets him up in a position where he is stronger to face the Republicans over that critical issue?

BORGER: The broad themes of this speech are designed to create a discussion that will do exactly that, Suzanne. He is starting today with a road show that will include five or six speeches between now and the beginning of the fight over the debt ceiling in which he will be speaking at various locations to audiences about what he thinks the priorities on the economy should be.

And that's all about him laying out the priorities, laying out what his vision is for America's future.

So for example, should the American public be -- should Congress be investing in infrastructure or jobs programs or hot jobs with high wages as opposed to only focusing, as he would put it, on a fight over debt and spending?

He's essentially trying to reorient the discussion over economic priorities before everybody starts focusing on the debt ceiling fight. He has a little more wind in his sails this time than he did last -- in the 2011 summer because the deficits have improved -- picture has improved, because of tax revenue and because, frankly, there have been some spending cuts, Suzanne.

MALVEAUX: Christine, let's talk about those spending cuts, because a big deal is made about the big automatic spending cuts that went into effect this year, the so-called sequester. That's going to happen next year as well. And we're talking about some $19 billion more needed to be cut from Defense, discretionary spending.

How do we feel that? Are we going to feel it? Is it going to get worse? And who is going to be impacted by that?

ROMANS: You know what, they have to fix this. They have to find a better way for making spending priorities and cutting priorities in Washington. This is no way for the biggest business in the world, the United States economy, to be run. We don't have a budget. We're lurching from fiscal crisis to fiscal crisis. They can't keep doing it like this.

The question for me is how is the president going to change that game plan in Washington? He's probably going to be needling House Republicans in this speech. He's probably going to say that they have been intransigent, that he had a jobs program. He had a jobs bill, and they wouldn't let it go through.

So how is he going to change that conversation and get it so that we're not doing this over and over again? We're not fighting about the debt ceiling again and again?

The Fed chief in his testimony last week -- he made a good point. He said the economy is slowly healing. It is moving at a moderate pace despite Washington, despite the fact that our fiscal house is a mess, despite the fact that we have to have a sequester instead of the well- thought-out spending cuts and budgetary restraint.

You know, so, even the Fed chief said we could be doing better if Washington could do a better job in running the books. And that's what -- the president has to change that tone. That -- something has to change. It can't be like it was last year and the year before.

Is he going to signal any kind of new game plan here? That's what we don't know.

MALVEAUX: Hey, Wolf, I want to bring you back into the conversation. Obviously we're keeping a close eye on the pictures there, waiting for the president to come out. We'll get to it as soon as he arrives. But, you know, sometimes it's all about the messaging and changing the focus here. Clearly the president wants to focus on the economy.

How does the White House really deal with that? How do they balance that with the other issues that people want to talk about, right? You have got the Zimmerman trial, Trayvon Martin, the issue of race, the IRS controversy.

How do they get back on message?

BLITZER: And there's so many foreign policy national security crises out there. The whole Middle East seems to be virtually in turmoil right now. And he's got the Edward Snowden issue as well in terms of the NSA surveillance.

Look, this president has a full agenda of problems out there. And I think he'll address some of them. He'll point that out.

But you know, when all is said and done, I think they feel at the White House that not enough has been focused in on the economy, especially the middle class, how the middle class is doing, what else the government can do to help the middle class, whether at the federal, state or local level.

And I think the president is going to say some things I'll need Congress to help me with, but other things I'm going to do through executive order.

MALVEAUX: All right. A very familiar call; let's listen in as the president arrives.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Hello, Galesburg!

(APPLAUSE)

Well, it's good to be home in Illinois.

(APPLAUSE)

It is good to be back. It's good to be back. Thank you. Thank you so much, everybody. Thank you so much. Thank you. Thank you.

(APPLAUSE)

Thank you so much. Thank you. Everybody, have a seat. Have a seat. Well, it is good to be back. I want to-I want to, first of all, thank Knox College.

(APPLAUSE)

I want to thank Knox College and your president, Teresa Amott, for having me here today. Give Teresa a big round of applause.

(APPLAUSE)

I want to thank your congresswoman, Cheri Bustos, who's here. Where's Cheri? There she is.

(APPLAUSE)

We've got Governor Quinn here.

(APPLAUSE)

I'm told we've got your lieutenant governor, Sheila Simon, is here. There she is.

(APPLAUSE)

Attorney General Lisa Madigan is here.

(APPLAUSE)

I see-I see a bunch of my former colleagues, some folks who I haven't seen in years, and I'm looking forward to saying hi to. One in particular I've got to mention, one of my favorites from the Illinois Senate, John Sullivan's in the house.

(APPLAUSE)

You know, John-John was one of my earliest supporters when I was running for the U.S. Senate, and it came in really handy, because he's got like 10 brothers and his wife and sisters. And his wife's got 10 brothers and sisters. So...

(LAUGHTER)

So they've got this entire precinct just in their family.

(LAUGHTER)

And they all look like John, the brothers do, so, you know, he doesn't have to go to every event. He can just send one of his brothers out.

(LAUGHTER)

It is good to see them.

Dick Durbin couldn't make it today, but he sends his best, and we love Dick. He is doing a great job.

(APPLAUSE)

And we've got one of my favorite neighbors, the senator from Missouri, Claire McCaskill, in the house, because we're going to Missouri later this afternoon. So...

(APPLAUSE)

And all of you are here, and it's great to see you.

(APPLAUSE) And I hope-I hope everybody's having a wonderful summer. The weather's perfect. Whoever was in charge of that, good job.

(LAUGHTER)

So, eight years ago, I came here to deliver the commencement address for the class of 2005. Now, things were a little different back then. For example, I had no gray hair.

(LAUGHTER)

Or a motorcade. Didn't even have a prompter. In fact, there was a problem in terms of printing out the speech, because the printer didn't work here, and we had to drive it in from somewhere. But it was my first big speech as your newest senator, and-and on the way here, I was telling Cheri and Claire about how important this area was, one of the areas that I spent the most time in, outside of Chicago, and-and how much it represented what's best in America, and folks who were willing to work hard and-and do right by their families.

And I came here to talk about what a changing economy was doing to the middle class and what we, as a country, needed to do to give every American a chance to get ahead in the 21st century.

See, I had just spent a year traveling the state and listening to your stories, of proud Maytag workers losing their jobs when the plant moved down to Mexico.

(APPLAUSE)

A lot of folks here remember that. Of teachers whose salaries weren't keeping up with the rising cost of groceries.

(APPLAUSE)

Of young people who had the drive and the energy, but not the money to afford a college education.

(APPLAUSE)

So these were stories of families who had worked hard, believed in the American dream, but they felt like the odds were increasingly stacked against them. And they were right. Things had changed.

In the period after World War II, a growing middle class was the engine of our prosperity. Whether you owned a company or swept its floors, or worked anywhere in between, this country offered you a basic bargain: a sense that your hard work would be rewarded with fair wages and decent benefits, the chance to buy a home, to save for retirement, and, most of all, a chance to hand down a better life for your kids.

But over time, that engine began to stall. And a lot of folks here saw it. That bargain began to fray. Technology made some jobs obsolete. Global competition sent a lot of jobs overseas. It became harder for unions to fight for the middle class. Washington doled out bigger tax cuts to the very wealthy and smaller minimum wage increases for the working poor.

And so what happened was that the link between higher productivity and people's wages and salaries was broken. It used to be that, as companies did better, as profits went higher, workers also got a better deal. And that started changing. So the income of the top 1 percent nearly quadrupled from 1979 to 2007, but the typical family's incomes barely budged.

And towards the end of those three decades, the housing bubble, credit cards, a churning financial sector was keeping the economy artificially juiced up, so sometimes it papered over some of these long-term trends. But by the time I took office in 2009 as your president, we all know, the bubble had burst, and it cost millions of Americans their jobs, and their homes, and their savings. And I know a lot of folks in this area were hurt pretty bad. And the decades- long erosion that had been taking place, the erosion of middle-class security was suddenly laid bare for everybody to see.

Now, today, five years after the start of that Great Recession, America has fought its way back. We've fought our way back.

(APPLAUSE)

Together, we saved the auto industry, took on a broken health care system...

(APPLAUSE)

... we invested in new American technologies to reverse our addiction to foreign oil. We doubled wind and solar power.

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Together, we put in place tough new rules on the big banks and protections to crack down on the worst practices of mortgage lenders and credit card companies.

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We changed a tax code too skewed in favor of the wealthiest at the expense of working families, so we changed that. We locked in tax cuts for 98 percent of Americans and we asked those at the top to pay a little bit more.

(APPLAUSE)

So you add it all up, and over the past 40 months, our businesses have created 7.2 million new jobs. This year, we're off to our strongest private-sector job growth since 1999. And because we bet on this country, suddenly foreign companies are, too.

Right now, more of Honda's cars are made in America than anyplace else on Earth.

(APPLAUSE)

Airbus, the European aircraft company, they're building new planes in Alabama. And then American companies like Ford are replacing outsourcing with insourcing. They're bringing jobs back home.

(APPLAUSE)

We sell more products made in America to the rest of the world than ever before. We produce more natural gas than any country on Earth. We're about to produce more of our own oil than we buy from abroad for the first time in nearly 20 years.

(APPLAUSE)

The cost of health care is growing at its slowest rate in 50 years.

(APPLAUSE)

And our deficits are falling at the fastest rate in 60 years.

(APPLAUSE)

So thanks to the grit and resilience and determination of the American people, the folks like you, we've been able to clear away the rubble from the financial crisis. We've started to lay a new foundation for stronger, more durable economic growth.

And, you know, it's happening in our own personal lives, as well, right? A lot of us tightened our belts, shed debt, maybe cut up a couple credit cards, refocused on those things that really mattered. As a country, we've recovered faster and gone further than most other advanced nations in the world. With new American revolutions in energy and technology and manufacturing and health care, we're actually poised to reverse the forces that battered the middle class for so long and start building an economy where everyone who works hard can get ahead.

But-and here's the big but-I'm here to tell you today that we're not there yet. We all know that. We're not there yet. We've got more work to do.

Even though our businesses are creating new jobs and have broken record profits, nearly all the income gains of the past 10 years have continued to flow to the top 1 percent. The average CEO has gotten a raise of nearly 40 percent since 2009. The average American earns less than he or she did in 1999. And companies continue to hold back on hiring those who've been out of work for some time.

Today, more students are earning their degree, but soaring costs saddle them with unsustainable debt. Health care costs are slowing down, but a lot of working families haven't seen any of those savings yet. And the stock market rebound helped a lot of families get back much of what they had lost in their 401(k)s, but millions of Americans still have no idea how they're going to be able to retire.

So in many ways, the trends that I spoke about here in 2005, eight years ago, the trend of a winner-take-all economy where a few are doing better and better and better, while everybody else just treads water, those trends have been made worse by the recession. And that's a problem.

This growing inequality, not just of result, inequality of opportunity, this growing inequality, it's not just morally wrong. It's bad economics. Because when middle-class families have less to spend, guess what? Businesses have fewer consumers. When wealth concentrates at the very top, it can inflate unstable bubbles that threaten the economy. When the rungs on the ladder of opportunity grow farther and farther apart, it undermines the very essence of America, that idea that if you-if you work hard, you can make it here.

And that's why reversing these trends has to be Washington's highest priority.

(APPLAUSE)

It has to be Washington's highest priority.

(APPLAUSE)

It's certainly my highest priority.

(APPLAUSE)

Unfortunately, over the past couple of years in particular,

Washington hasn't just ignored this problem. Too often, Washington's made things worse.

(APPLAUSE)

And I have to say that, you know-because I'm looking around the room, I've got some friends here not just who are Democrats. I've got some friends here who are Republicans and who work-yeah, I worked with the state legislature, and they did great work.

But right now, what we've got in Washington, we've seen a sizable group of Republican lawmakers suggest that they wouldn't vote to pay the very bills that Congress rang up, and that fiasco harmed a fragile recovery in 2011, and we can't afford to repeat that.

Then, rather than reduce our deficits with a scalpel-by cutting out programs we don't need, fixing ones that we do need that maybe are in need of reform, making government more efficient, instead of doing that, we've got folks who've insisted on leaving in place a meat cleaver called the sequester that's cost jobs, it's harmed growth, it's hurt our military, it's gutted investments in education and science and medical research...

(APPLAUSE)

Almost every credible economist will tell you, it's been a huge drag on this recovery. And it means that we're underinvesting in the things that this country needs to make it a magnet for good jobs. Then, over the last six months, this gridlock's gotten worse. I didn't think that was possible.

(LAUGHTER)

The good news is, a growing number of Republican senators are looking to join their Democratic counterparts and try to get things done in the Senate. So that's good news.

(APPLAUSE)

For example, they worked together on an immigration bill that economists say will boost our economy by more than $1 trillion, strengthen border security, make the system work. But you've got a faction of Republicans in the House won't even give that bill a vote, and that same group gutted a farm bill that America's farmers depend on, but also America's most vulnerable children depend on.

(UNKNOWN): Boo!

OBAMA: And if you ask some of these folks, some of these folks mostly in the House, about their economic agenda how it is that they'll strengthen the middle class, they'll shift the topic to out-of-control government spending, despite the fact that we've cut the deficit by nearly half as a share of the economy since I took office.

(APPLAUSE)

Or they'll talk about government assistance for the poor, despite the fact that they've already cut early education for vulnerable kids. They've already cut insurance for people who've lost their jobs through no fault of their own.

Or they'll bring up Obamacare-this is tried and true- despite the fact that our businesses have created nearly twice as many jobs in this recovery as businesses had at the same point in the last recovery when there was no Obamacare.