Chapter II: Part 2

Fourth, we need to invest in the skills and education of our people. Now, this year, we've broken through the stalemate between left and right by launching a national competition to improve our schools. And the idea here is simple: Instead of rewarding failure, we only reward success. Instead of funding the status quo, we only invest in reform, reform that raises student achievement, inspires students to excel in math and science, and turns around failing schools that steal the future of too many young Americans, from rural communities to the inner city. In the 21st century, the best antipoverty program around is a world-class education. And in this country, the success of our children cannot depend more on where they live than on their potential. When we renew the Elementary and Secondary Education Act, we will work with Congress to expand these reforms to all 50 States.

Still, in this economy, a high school diploma no longer guarantees a good job. That's why I urge the Senate to follow the House and pass a bill that will revitalize our community colleges, which are a career pathway to the children of so many working families.

To make college more affordable, this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans. Instead, let's take that money and give families a $10,000 tax credit for 4 years of college and increase Pell grants. And let's tell another 1 million students that when they graduate, they will be required to pay only 10 percent of their income on student loans and all of their debt will be forgiven after 20 years and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college. And by the way, it's time for colleges and universities to get serious about cutting their own costs, because they too have a responsibility to help solve this problem.

Now, the price of college tuition is just one of the burdens facing the middle class. That's why last year, I asked Vice President Biden to chair a task force on middle class families. That's why we're nearly doubling the childcare tax credit and making it easier to save for retirement by giving access to every worker a retirement account and expanding the tax credit for those who start a nest egg. That's why we're working to lift the value of a family's single largest investment, their home. The steps we took last year to shore up the housing market have allowed millions of Americans to take out new loans and save an average of $1,500 on mortgage payments. This year, we will step up refinancing so that homeowners can move into more affordable mortgages.

And it is precisely to relieve the burden on middle class families that we still need health insurance reform. Yes, we do.

Now, let's clear a few things up. I didn't choose to tackle this issue to get some legislative victory under my belt. And by now it should be fairly obvious that I didn't take on health care because it was good politics. [Laughter] I took on health care because of the stories I've heard from Americans with preexisting conditions whose lives depend on getting coverage, patients who've been denied coverage, families, even those with insurance, who are just one illness away from financial ruin.

After nearly a century of trying--Democratic administrations, Republican administrations--we are closer than ever to bringing more security to the lives of so many Americans. The approach we've taken would protect every American from the worst practices of the insurance industry. It would give small businesses and uninsured Americans a chance to choose an affordable health care plan in a competitive market. It would require every insurance plan to cover preventive care.

And by the way, I want to acknowledge our First Lady, Michelle Obama, who this year is creating a national movement to tackle the epidemic of childhood obesity and make kids healthier. [Applause] Thank you, honey. She gets embarrassed. [Laughter]

Our approach would preserve the right of Americans who have insurance to keep their doctor and their plan. It would reduce costs and premiums for millions of families and businesses. And according to the Congressional Budget Office, the independent organization that both parties have cited as the official scorekeeper for Congress, our approach would bring down the deficit by as much as $1 trillion over the next two decades.

Still, this is a complex issue, and the longer it was debated, the more skeptical people became. I take my share of the blame for not explaining it more clearly to the American people. And I know that with all the lobbying and horse-trading, the process left most Americans wondering, "What's in it for me?"

But I also know this problem is not going away. By the time I'm finished speaking tonight, more Americans will have lost their health insurance. Millions will lose it this year. Our deficit will grow. Premiums will go up. Patients will be denied the care they need. Small- business owners will continue to drop coverage altogether. I will not walk away from these Americans, and neither should the people in this Chamber.

So as temperatures cool, I want everyone to take another look at the plan we've proposed. There's a reason why many doctors, nurses, and health care experts who know our system best consider this approach a vast improvement over the status quo. But if anyone from either party has a better approach that will bring down premiums, bring down the deficit, cover the uninsured, strengthen Medicare for seniors, and stop insurance company abuses, let me know. Let me know. Let me know. I'm eager to see it.

Here's what I ask Congress, though: Don't walk away from reform. Not now. Not when we are so close. Let us find a way to come together and finish the job for the American people. Let's get it done. Let's get it done.

Now, even as health care reform would reduce our deficit, it's not enough to dig us out of a massive fiscal hole in which we find ourselves. It's a challenge that makes all others that much harder to solve and one that's been subject to a lot of political posturing. So let me start the discussion of Government spending by setting the record straight.

At the beginning of the last decade, the year 2000, America had a budget surplus of over $200 billion. By the time I took office, we had a 1-year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade. Most of this was the result of not paying for two wars, two tax cuts, and an expensive prescription drug program. On top of that, the effects of the recession put a $3 trillion hole in our budget. All this was before I walked in the door. [Laughter]

Now--[applause]--just stating the facts. Now, if we had taken office in ordinary times, I would have liked nothing more than to start bringing down the deficit. But we took office amid a crisis. And our efforts to prevent a second depression have added another $1 trillion to our national debt. That too is a fact.

I'm absolutely convinced that was the right thing to do. But families across the country are tightening their belts and making tough decisions. The Federal Government should do the same. So tonight I'm proposing specific steps to pay for the trillion dollars that it took to rescue the economy last year.

Starting in 2011, we are prepared to freeze Government spending for 3 years. Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected. But all other discretionary Government programs will. Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don't. And if I have to enforce this discipline by veto, I will.

We will continue to go through the budget, line by line, page by page, to eliminate programs that we can't afford and don't work. We've already identified $20 billion in savings for next year. To help working families, we'll extend our middle class tax cuts. But at a time of record deficits, we will not continue tax cuts for oil companies, for investment fund managers, and for those making over $250,000 a year. We just can't afford it.

Now, even after paying for what we spent on my watch, we'll still face the massive deficit we had when I took office. More importantly, the cost of Medicare, Medicaid, and Social Security will continue to skyrocket. That's why I've called for a bipartisan fiscal commission, modeled on a proposal by Republican Judd Gregg and Democrat Kent Conrad. This can't be one of those Washington gimmicks that lets us pretend we solve a problem. The commission will have to provide a specific set of solutions by a certain deadline.

Now, yesterday the Senate blocked a bill that would have created this commission, so I'll issue an Executive order that will allow us to go forward, because I refuse to pass this problem on to another generation of Americans. And when the vote comes tomorrow, the Senate should restore the pay-as-you-go law that was a big reason for why we had record surpluses in the 1990s.

Now, I know that some in my own party will argue that we can't address the deficit or freeze Government spending when so many are still hurting. And I agree, which is why this freeze won't take effect until next year, when the economy is stronger. That's how budgeting works. [Laughter] But understand, if we don't take meaningful steps to rein in our debt, it could damage our markets, increase the cost of borrowing, and jeopardize our recovery, all of which would have an even worse effect on our job growth and family incomes.

From some on the right, I expect we'll hear a different argument, that if we just make fewer investments in our people, extend tax cuts, including those for the wealthier Americans, eliminate more regulations, maintain the status quo on health care, our deficits will go away. The problem is, that's what we did for 8 years. That's what helped us into this crisis. It's what helped lead to these deficits. We can't do it again.

Rather than fight the same tired battles that have dominated Washington for decades, it's time to try something new. Let's invest in our people without leaving them a mountain of debt. Let's meet our responsibility to the citizens who sent us here. Let's try common sense--[Laughter]--a novel concept.

Now, to do that, we have to recognize that we face more than a deficit of dollars right now. We face a deficit of trust, deep and corrosive doubts about how Washington works that have been growing for years. To close that credibility gap, we have to take action on both ends of Pennsylvania Avenue to end the outsized influence of lobbyists, to do our work openly, to give our people the Government they deserve.

Now, that's what I came to Washington to do. That's why, for the first time in history, my administration posts on--our White House visitors online. That's why we've excluded lobbyists from policymaking jobs or seats on Federal boards and commissions. But we can't stop there. It's time to require lobbyists to disclose each contact they make on behalf of a client, with my administration or with Congress. It's time to put strict limits on the contributions that lobbyists give to candidates for Federal office.

With all due deference to separation of powers, last week, the Supreme Court reversed a century of law that I believe will open the floodgates for special interests, including foreign corporations, to spend without limit in our elections. I don't think American elections should be bankrolled by America's most powerful interests, or worse, by foreign entities. They should be decided by the American people. And I'd urge Democrats and Republicans to pass a bill that helps correct some of these problems.

I'm also calling on Congress to continue down the path of earmark reform, Democrats and Republicans--Democrats and Republicans. Look, you've trimmed some of this spending, you've embraced some meaningful change, but restoring the public trust demands more. For example, some Members of Congress post some earmark requests online. Tonight I'm calling on Congress to publish all earmark requests on a single web site before there's a vote so that the American people can see how their money is being spent.

Of course, none of these reforms will even happen if we don't also reform how we work with one another. Now, I'm not naive. I never thought that the mere fact of my election would usher in peace and harmony and--[Laughter]--some postpartisan era. I knew that both parties have fed divisions that are deeply entrenched. And on some issues, there are simply philosophical differences that will always cause us to part ways. These disagreements, about the role of government in our lives, about our national priorities and our national security, they've been taking place for over 200 years. They're the very essence of our democracy.

But what frustrates the American people is a Washington where every day is election day. We can't wage a perpetual campaign where the only goal is to see who can get the most embarrassing headlines about the other side, a belief that if you lose, I win. Neither party should delay or obstruct every single bill just because they can. The confirmation of-- I'm speaking to both parties now--the confirmation of well-qualified public servants shouldn't be held hostage to the pet projects or grudges of a few individual Senators.

Washington may think that saying anything about the other side, no matter how false, no matter how malicious, is just part of the game. But it's precisely such politics that has stopped either party from helping the American people. Worse yet, it's sowing further division among our citizens, further distrust in our Government. So no, I will not give up on trying to change the tone of our politics. I know it's an election year. And after last week, it's clear that campaign fever has come even earlier than usual. But we still need to govern.

To Democrats, I would remind you that we still have the largest majority in decades and the people expect us to solve problems, not run for the hills. And if the Republican leadership is going to insist that 60 votes in the Senate are required to do any business at all in this town--a supermajority--then the responsibility to govern is now yours as well. Just saying no to everything may be good short-term politics, but it's not leadership. We were sent here to serve our citizens, not our ambitions. So let's show the American people that we can do it together.

This week, I'll be addressing a meeting of the House Republicans. I'd like to begin monthly meetings with both Democratic and Republican leadership. I know you can't wait. [Laughter]

Now, throughout our history, no issue has united this country more than our security. Sadly, some of the unity we felt after 9/11 has dissipated. And we can argue all we want about who's to blame for this, but I'm not interested in relitigating the past. I know that all of us love this country. All of us are committed to its defense. So let's put aside the schoolyard taunts about who's tough. Let's reject the false choice between protecting our people and upholding our values. Let's leave behind the fear and division and do what it takes to defend our Nation and forge a more hopeful future for America and for the world.

That's the work we began last year. Since the day I took office, we've renewed our focus on the terrorists who threaten our Nation. We've made substantial investments in our homeland security and disrupted plots that threatened to take American lives. We are filling unacceptable gaps revealed by the failed Christmas attack, with better airline security and swifter action on our intelligence. We've prohibited torture and strengthened partnerships from the Pacific to South Asia to the Arabian Peninsula. And in the last year, hundreds of Al Qaida's fighters and affiliates, including many senior leaders, have been captured or killed, far more than in 2008.

And in Afghanistan, we're increasing our troops and training Afghan security forces so they can begin to take the lead in July of 2011 and our troops can begin to come home. We will reward good governance, work to reduce corruption, and support the rights of all Afghans, men and women alike. We're joined by allies and partners who have increased their own commitments and who will come together tomorrow in London to reaffirm our common purpose. There will be difficult days ahead, but I am absolutely confident we will succeed.

As we take the fight to Al Qaida, we are responsibly leaving Iraq to its people. As a candidate, I promised that I would end this war, and that is what I am doing as President. We will have all of our combat troops out of Iraq by the end of this August. We will support the Iraqi Government as they hold elections, and we will continue to partner with the Iraqi people to promote regional peace and prosperity. But make no mistake: This war is ending, and all of our troops are coming home.

Tonight all of our men and women in uniform, in Iraq, in Afghanistan, and around the world, they have to know that we--that they have our respect, our gratitude, our full support. And just as they must have the resources they need in war, we all have a responsibility to support them when they come home. That's why we made the largest increase in investments for veterans in decades last year. That's why we're building a 21st-century VA. And that's why Michelle has joined with Jill Biden to forge a national commitment to support military families.

Now, even as we prosecute two wars, we're also confronting perhaps the greatest danger to the American people, the threat of nuclear weapons. I've embraced the vision of John F. Kennedy and Ronald Reagan through a strategy that reverses the spread of these weapons and seeks a world without them. To reduce our stockpiles and launchers, while ensuring our deterrent, the United States and Russia are completing negotiations on the farthest reaching arms control treaty in nearly two decades. And at April's Nuclear Security Summit, we will bring 44 nations together here in Washington, DC, behind a clear goal: securing all vulnerable nuclear materials around the world in 4 years so that they never fall into the hands of terrorists.

Now, these diplomatic efforts have also strengthened our hand in dealing with those nations that insist on violating international agreements in pursuit of nuclear weapons. That's why North Korea now faces increased isolation and stronger sanctions, sanctions that are being vigorously enforced. That's why the international community is more united and the Islamic Republic of Iran is more isolated. And as Iran's leaders continue to ignore their obligations, there should be no doubt: They too will face growing consequences. That is a promise.

That's the leadership we are providing: engagement that advances the common security and prosperity of all people. We're working through the G-20 to sustain a lasting global recovery. We're working with Muslim communities around the world to promote science and education and innovation. We have gone from a bystander to a leader in the fight against climate change. We're helping developing countries to feed themselves and continuing the fight against HIV/AIDS. And we are launching a new initiative that will give us the capacity to respond faster and more effectively to bioterrorism or an infectious disease, a plan that will counter threats at home and strengthen public health abroad.

As we have for over 60 years, America takes these actions because our destiny is connected to those beyond our shores. But we also do it because it is right. That's why, as we meet here tonight, over 10,000 Americans are working with many nations to help the people of Haiti recover and rebuild. That's why we stand with the girl who yearns to go to school in Afghanistan, why we support the human rights of the women marching through the streets of Iran, why we advocate for the young man denied a job by corruption in Guinea. For America must always stand on the side of freedom and human dignity--always.

Abroad, America's greatest source of strength has always been our ideals. The same is true at home. We find unity in our incredible diversity, drawing on the promise enshrined in our Constitution: The notion that we're all created equal; that no matter who you are or what you look like, if you abide by the law, you should be protected by it; if you adhere to our common values, you should be treated no different than anyone else.

We must continually renew this promise. My administration has a Division that is once again prosecuting violations and employment discrimination. We finally strengthened our laws to protect against crimes driven by hate. This year, I will work with Congress and our military to finally repeal the law that denies gay Americans the right to serve the country they love because of who they are. It's the right thing to do.

We're going to crack down on violations of equal pay laws so that women get equal pay for an equal day's work. And we should continue the work of fixing our broken immigration system, to secure our borders and enforce our laws and ensure that everyone who plays by the rules can contribute to our economy and enrich our Nation.

In the end, it's our ideals, our values that built America, values that allowed us to forge a nation made up of immigrants from every corner of the globe, values that drive our citizens still. Every day, Americans meet their responsibilities to their families and their employers. Time and again, they lend a hand to their neighbors and give back to their country. They take pride in their labor and are generous in spirit. These aren't Republican values or Democratic values that they're living by, business values or labor values, they're American values.

Unfortunately, too many of our citizens have lost faith that our biggest institutions--our corporations, our media, and, yes, our Government--still reflect these same values. Each of these institutions are full of honorable men and women doing important work that helps our country prosper. But each time a CEO rewards himself for failure or a banker puts the rest of us at risk for his own selfish gain, people's doubts grow. Each time lobbyists game the system or politicians tear each other down instead of lifting this country up, we lose faith. The more that TV pundits reduce serious debates to silly arguments, big issues into sound bites, our citizens turn away. No wonder there's so much cynicism out there. No wonder there's so much disappointment.

I campaigned on the promise of change. Change we can believe in, the slogan went. And right now I know there are many Americans who aren't sure if they still believe we can change or that I can deliver it.

But remember this: I never suggested that change would be easy or that I could do it alone. Democracy in a nation of 300 million people can be noisy and messy and complicated. And when you try to do big things and make big changes, it stirs passions and controversy. That's just how it is.

Those of us in public office can respond to this reality by playing it safe and avoid telling hard truths and pointing fingers. We can do what's necessary to keep our poll numbers high and get through the next election, instead of doing what's best for the next generation.

But I also know this: If people had made that decision 50 years ago or 100 years ago or 200 years ago, we wouldn't be here tonight. The only reason we are here is because generations of Americans were unafraid to do what was hard, to do what was needed even when success was uncertain, to do what it took to keep the dream of this Nation alive for their children and their grandchildren.

Now, our administration has had some political setbacks this year, and some of them were deserved. But I wake up every day knowing that they are nothing compared to the setbacks that families all across this country have faced this year. And what keeps me going, what keeps me fighting, is that despite all these setbacks, that spirit of determination and optimism, that fundamental decency that has always been at the core of the American people, that lives on.

It lives on in the struggling small-business owner who wrote to me of his company, "None of us," he said, ". . . are willing to consider, even slightly, that we might fail." It lives on in the woman who said that even though she and her neighbors have felt the pain of recession, "We are strong. We are resilient. We are American." It lives on in the 8-year-old boy in Louisiana who just sent me his allowance and asked if I would give it to the people of Haiti. And it lives on in all the Americans who've dropped everything to go someplace they've never been and pull people they've never known from the rubble, prompting chants of "U.S.A.! U.S.A.! U.S.A.!" when another life was saved.

The spirit that has sustained this Nation for more than two centuries lives on in you, its people. We have finished a difficult year. We have come through a difficult decade. But a new year has come. A new decade stretches before us. We don't quit. I don't quit. Let's seize this moment to start anew, to carry the dream forward, and to strengthen our Union once more.

Thank you. God bless you, and God bless the United States of America.

***

Address Before a Joint Session of the Congress on the State of the Union Barack Obama January 25, 2011

Mr. Speaker, Mr. Vice President, Members of Congress, distinguished guests, and fellow Americans: Tonight I want to begin by congratulating the men and women of the 112th Congress, as well as your new Speaker, John Boehner. And as we mark this occasion, we're also mindful of the empty chair in this Chamber, and we pray for the health of our colleague and our friend Gabby Giffords.

It's no secret that those of us here tonight have had our differences over the last 2 years. The debates have been contentious; we have fought fiercely for our beliefs. And that's a good thing. That's what a robust democracy demands. That's what helps set us apart as a nation.

But there's a reason the tragedy in Tucson gave us pause. Amid all the noise and passion and rancor of our public debate, Tucson reminded us that no matter who we are or where we come from, each of us is a part of something greater, something more consequential than party or political preference.

We are part of the American family. We believe that in a country where every race and faith and point of view can be found, we are still bound together as one people, that we share common hopes and a common creed, that the dreams of a little girl in Tucson are not so different than those of our own children, that they all deserve the chance to be fulfilled. That too is what sets us apart as a nation.

Now, by itself, this simple recognition won't usher in a new era of cooperation. What comes of this moment is up to us. What comes of this moment will be determined not by whether we can sit together tonight, but whether we can work together tomorrow.

I believe we can, and I believe we must. That's what the people who sent us here expect of us. With their votes, they've determined that governing will now be a shared responsibility between parties. New laws will only pass with support from Democrats and Republicans. We will move forward together or not at all, for the challenges we face are bigger than party and bigger than politics.

At stake right now is not who wins the next election. After all, we just had an election. At stake is whether new jobs and industries take root in this country or somewhere else. It's whether the hard work and industry of our people is rewarded. It's whether we sustain the leadership that has made America not just a place on a map, but the light to the world.

We are poised for progress. Two years after the worst recession most of us have ever known, the stock market has come roaring back, corporate profits are up, the economy is growing again.

But we have never measured progress by these yardsticks alone. We measure progress by the success of our people, by the jobs they can find and the quality of life those jobs offer, by the prospects of a small-business owner who dreams of turning a good idea into a thriving enterprise, by the opportunities for a better life that we pass on to our children.

That's the project the American people want us to work on--together.

Now, we did that in December. Thanks to the tax cuts we passed, Americans' paychecks are a little bigger today. Every business can write off the full cost of new investments that they make this year. And these steps, taken by Democrats and Republicans, will grow the economy and add to the more than 1 million private sector jobs created last year.

But we have to do more. These steps we've taken over the last 2 years may have broken the back of this recession, but to win the future, we'll need to take on challenges that have been decades in the making.

Many people watching tonight can probably remember a time when finding a good job meant showing up at a nearby factory or a business downtown. You didn't always need a degree, and your competition was pretty much limited to your neighbors. If you worked hard, chances are you'd have a job for life, with a decent paycheck and good benefits and the occasional promotion. Maybe you'd even have the pride of seeing your kids work at the same company.

That world has changed. And for many, the change has been painful. I've seen it in the shuttered windows of once booming factories and the vacant storefronts on once busy Main Streets. I've heard it in the frustrations of Americans who've seen their paychecks dwindle or their jobs disappear, proud men and women who feel like the rules have been changed in the middle of the game.

They're right. The rules have changed. In a single generation, revolutions in technology have transformed the way we live, work, and do business. Steel mills that once needed 1,000 workers can now do the same work with 100. Today, just about any company can set up shop, hire workers, and sell their products wherever there's an Internet connection.

Meanwhile, nations like China and India realized that with some changes of their own, they could compete in this new world. And so they started educating their children earlier and longer, with greater emphasis on math and science. They're investing in research and new technologies. Just recently, China became the home to the world's largest private solar research facility and the world's fastest computer.

So yes, the world is changed. The competition for jobs is real. But this shouldn't discourage us. It should challenge us. Remember, for all the hits we've taken these last few years, for all the naysayers predicting our decline, America still has the largest, most prosperous economy in the world. No workers are more productive than ours. No country has more successful companies or grants more patents to inventors and entrepreneurs. We're the home to the world's best colleges and universities, where more students come to study than any place on Earth.

What's more, we are the first nation to be founded for the sake of an idea: the idea that each of us deserves the chance to shape our own destiny. That's why centuries of pioneers and immigrants have risked everything to come here. It's why our students don't just memorize equations, but answer questions like: "What do you think of that idea? What would you change about the world? What do you want to be when you grow up?"

The future is ours to win. But to get there, we can't just stand still. As Robert Kennedy told us: "The future is not a gift. It is an achievement." Sustaining the American Dream has never been about standing pat. It has required each generation to sacrifice and struggle and meet the demands of a new age.

And now it's our turn. We know what it takes to compete for the jobs and industries of our time. We need to outinnovate, outeducate, and outbuild the rest of the world. We have to make America the best place on Earth to do business. We need to take responsibility for our deficit and reform our Government. That's how our people will prosper. That's how we'll win the future. And tonight I'd like to talk about how we get there.

The first step in winning the future is encouraging American innovation. None of us can predict with certainty what the next big industry will be or where the new jobs will come from. Thirty years ago, we couldn't know that something called the Internet would lead to an economic revolution. What we can do--what America does better than anyone else-- is spark the creativity and imagination of our people. We're the nation that put cars in driveways and computers in offices; the nation of Edison and the Wright brothers, of Google and Facebook. In America, innovation doesn't just change our lives. It is how we make our living.

Our free enterprise system is what drives innovation. But because it's not always profitable for companies to invest in basic research, throughout our history, our Government has provided cutting-edge scientists and inventors with the support that they need. That's what planted the seeds for the Internet. That's what helped make possible things like computer chips and GPS. Just think of all the good jobs-- from manufacturing to retail--that have come from these breakthroughs.

Half a century ago, when the Soviets beat us into space with the launch of a satellite called Sputnik, we had no idea how we would beat them to the Moon. The science wasn't even there yet. NASA didn't exist. But after investing in better research and education, we didn't just surpass the Soviets, we unleashed a wave of innovation that created new industries and millions of new jobs.

This is our generation's Sputnik moment. Two years ago, I said that we needed to reach a level of research and development we haven't seen since the height of the space race. And in a few weeks, I will be sending a budget to Congress that helps us meet that goal. We'll invest in biomedical research, information technology, and especially clean energy technology, an investment that will strengthen our security, protect our planet, and create countless new jobs for our people.

Already, we're seeing the promise of renewable energy. Robert and Gary Allen are brothers who run a small Michigan roofing company. After September 11, they volunteered their best roofers to help repair the Pentagon. But half of their factory went unused, and the recession hit them hard. Today, with the help of a Government loan, that empty space is being used to manufacture solar shingles that are being sold all across the country. In Robert's words, "We reinvented ourselves."

That's what Americans have done for over 200 years: reinvented ourselves. And to spur on more success stories like the Allen Brothers, we've begun to reinvent our energy policy. We're not just handing out money. We're issuing a challenge. We're telling America's scientists and engineers that if they assemble teams of the best minds in their fields and focus on the hardest problems in clean energy, we'll fund the Apollo projects of our time.

At the California Institute of Technology, they're developing a way to turn sunlight and water into fuel for our cars. At Oak Ridge National Laboratory, they're using supercomputers to get a lot more power out of our nuclear facilities. With more research and incentives, we can break our dependence on oil with biofuels and become the first country to have a million electric vehicles on the road by 2015.

We need to get behind this innovation. And to help pay for it, I'm asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies. I don't know if you've noticed, but they're doing just fine on their own. [Laughter] So instead of subsidizing yesterday's energy, let's invest in tomorrow's.

Now, clean energy breakthroughs will only translate into clean energy jobs if businesses know there will be a market for what they're selling. So tonight I challenge you to join me in setting a new goal: By 2035, 80 percent of America's electricity will come from clean energy sources.

Some folks want wind and solar. Others want nuclear, clean coal, and natural gas. To meet this goal, we will need them all, and I urge Democrats and Republicans to work together to make it happen.

Maintaining our leadership in research and technology is crucial to America's success. But if we want to win the future, if we want innovation to produce jobs in America and not overseas, then we also have to win the race to educate our kids.

Think about it. Over the next 10 years, nearly half of all new jobs will require education that goes beyond a high school education. And yet as many as a quarter of our students aren't even finishing high school. The quality of our math and science education lags behind many other nations. America has fallen to ninth in the proportion of young people with a college degree. And so the question is whether all of us, as citizens and as parents, are willing to do what's necessary to give every child a chance to succeed.

That responsibility begins not in our classrooms, but in our homes and communities. It's family that first instills the love of learning in a child. Only parents can make sure the TV is turned off and homework gets done. We need to teach our kids that it's not just the winner of the Super Bowl who deserves to be celebrated, but the winner of the science fair. We need to teach them that success is not a function of fame or PR, but of hard work and discipline.

Our schools share this responsibility. When a child walks into a classroom, it should be a place of high expectations and high performance. But too many schools don't meet this test. That's why instead of just pouring money into a system that's not working, we launched a competition called Race to the Top. To all 50 States, we said, "If you show us the most innovative plans to improve teacher quality and student achievement, we'll show you the money."

Race to the Top is the most meaningful reform of our public schools in a generation. For less than 1 percent of what we spend on education each year, it has led over 40 States to raise their standards for teaching and learning. And these standards were developed, by the way, not by Washington, but by Republican and Democratic Governors throughout the country. And Race to the Top should be the approach we follow this year as we replace No Child Left Behind with a law that's more flexible and focused on what's best for our kids.

You see, we know what's possible from our children when reform isn't just a top-down mandate, but the work of local teachers and principals, school boards and communities. Take a school like Bruce Randolph in Denver. Three years ago, it was rated one of the worst schools in Colorado, located on turf between two rival gangs. But last May, 97 percent of the seniors received their diploma. Most will be the first in their families to go to college. And after the first year of the school's transformation, the principal who made it possible wiped away tears when a student said, "Thank you, Ms. Waters, for showing that we are smart and we can make it." That's what good schools can do, and we want good schools all across the country.

Let's also remember that after parents, the biggest impact on a child's success comes from the man or woman at the front of the classroom. In South Korea, teachers are known as nation builders. Here in America, it's time we treated the people who educate our children with the same level of respect. We want to reward good teachers and stop making excuses for bad ones. And over the next 10 years, with so many baby boomers retiring from our classrooms, we want to prepare 100,000 new teachers in the fields of science and technology and engineering and math.

In fact, to every young person listening tonight who's contemplating their career choice: If you want to make a difference in the life of our Nation, if you want to make a difference in the life of a child, become a teacher. Your country needs you.

Of course, the education race doesn't end with a high school diploma. To compete, higher education must be within the reach of every American. That's why we've ended the unwarranted taxpayer subsidies that went to banks and used the savings to make college affordable for millions of students. And this year, I ask Congress to go further and make permanent our tuition tax credit, worth $10,000 for 4 years of college. It's the right thing to do.

Because people need to be able to train for new jobs and careers in today's fast-changing economy, we're also revitalizing America's community colleges. Last month, I saw the promise of these schools at Forsyth Tech in North Carolina. Many of the students there used to work in the surrounding factories that have since left town. One mother of two, a woman named Kathy Proctor, had worked in the furniture industry since she was 18 years old. And she told me she's earning her degree in biotechnology now, at 55 years old, not just because the furniture jobs are gone, but because she wants to inspire her children to pursue their dreams too. As Kathy said, "I hope it tells them to never give up."

If we take these steps, if we raise expectations for every child and give them the best possible chance at an education, from the day they are born until the last job they take, we will reach the goal that I set 2 years ago: By the end of the decade, America will once again have the highest proportion of college graduates in the world.

One last point about education: Today, there are hundreds of thousands of students excelling in our schools who are not American citizens. Some are the children of undocumented workers, who had nothing to do with the actions of their parents. They grew up as Americans and pledge allegiance to our flag, and yet they live every day with the threat of deportation. Others come here from abroad to study in our colleges and universities. But as soon as they obtain advanced degrees, we send them back home to compete against us. It makes no sense.

Now, I strongly believe that we should take on, once and for all, the issue of illegal immigration. And I am prepared to work with Republicans and Democrats to protect our borders, enforce our laws, and address the millions of undocumented workers who are now living in the shadows. I know that debate will be difficult. I know it will take time. But tonight, let's agree to make that effort. And let's stop expelling talented, responsible young people who could be staffing our research labs or starting a new business, who could be further enriching this Nation.

The third step in winning the future is rebuilding America. To attract new businesses to our shores, we need the fastest, most reliable ways to move people, goods, and information, from high-speed rail to high- speed Internet.

Our infrastructure used to be the best, but our lead has slipped. South Korean homes now have greater Internet access than we do. Countries in Europe and Russia invest more in their roads and railways than we do. China is building faster trains and newer airports. Meanwhile, when our own engineers graded our Nation's infrastructure, they gave us a D.

We have to do better. America is the nation that built the transcontinental railroad, brought electricity to rural communities, constructed the Interstate Highway System. The jobs created by these projects didn't just come from laying down track or pavement. They came from businesses that opened near a town's new train station or the new off-ramp.

So over the last 2 years, we've begun rebuilding for the 21st century, a project that has meant thousands of good jobs for the hard-hit construction industry. And tonight I'm proposing that we redouble those efforts.

We'll put more Americans to work repairing crumbling roads and bridges. We'll make sure this is fully paid for, attract private investment, and pick projects based [on]* what's best for the economy, not politicians.

Within 25 years, our goal is to give 80 percent of Americans access to high-speed rail. This could allow you to go places in half the time it takes to travel by car. For some trips, it will be faster than flying, without the pat-down. [Laughter] As we speak, routes in California and the Midwest are already underway.

Within the next 5 years, we'll make it possible for businesses to deploy the next generation of high-speed wireless coverage to 98 percent of all Americans. This isn't just about--this isn't about faster Internet or fewer dropped calls. It's about connecting every part of America to the digital age. It's about a rural community in Iowa or Alabama where farmers and small-business owners will be able to sell their products all over the world. It's about a firefighter who can download the design of a burning building onto a handheld device, a student who can take classes with a digital textbook, or a patient who can have face-to-face video chats with her doctor.

All these investments--in innovation, education, and infrastructure-- will make America a better place to do business and create jobs. But to help our companies compete, we also have to knock down barriers that stand in the way of their success.

For example, over the years, a parade of lobbyists has rigged the Tax Code to benefit particular companies and industries. Those with accountants or lawyers to work the system can end up paying no taxes at all. But all the rest are hit with one of the highest corporate tax rates in the world. It makes no sense, and it has to change.

So tonight I'm asking Democrats and Republicans to simplify the system, get rid of the loopholes, level the playing field, and use the savings to lower the corporate tax rate for the first time in 25 years without adding to our deficit. It can be done.

To help businesses sell more products abroad, we set a goal of doubling our exports by 2014. Because the more we export, the more jobs we create here at home. Already, our exports are up. Recently, we signed agreements with India and China that will support more than 250,000 jobs here in the United States. And last month, we finalized a trade agreement with South Korea that will support at least 70,000 American jobs. This agreement has unprecedented support from business and labor, Democrats and Republicans, and I ask this Congress to pass it as soon as possible.

Now, before I took office, I made it clear that we would enforce our trade agreements and that I would only sign deals that keep faith with American workers and promote American jobs. That's what we did with Korea, and that's what I intend to do as we pursue agreements with Panama and Colombia and continue our Asia-Pacific and global trade talks.

To reduce barriers to growth and investment, I've ordered a review of Government regulations. When we find rules that put an unnecessary burden on businesses, we will fix them. But I will not hesitate to create or enforce commonsense safeguards to protect the American people. That's what we've done in this country for more than a century. It's why our food is safe to eat, our water is safe to drink, and our air is safe to breathe. It's why we have speed limits and child labor laws. It's why last year, we put in place consumer protections against hidden fees and penalties by credit card companies and new rules to prevent another financial crisis. And it's why we passed reform that finally prevents the health insurance industry from exploiting patients.

Now, I have heard rumors that a few of you still have concerns about our new health care law. [Laughter] So let me be the first to say that anything can be improved. If you have ideas about how to improve this law by making care better or more affordable, I am eager to work with you. We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses.

What I'm not willing to do--what I'm not willing to do--is go back to the days when insurance companies could deny someone coverage because of a preexisting condition.

I'm not willing to tell James Howard, a brain cancer patient from Texas, that his treatment might not be covered. I'm not willing to tell Jim Houser, a small-businessman from Oregon, that he has to go back to paying $5,000 more to cover his employees. As we speak, this law is making prescription drugs cheaper for seniors and giving uninsured students a chance to stay on their patients'--parents' coverage.

So I say to this Chamber tonight: Instead of refighting the battles of the last 2 years, let's fix what needs fixing, and let's move forward.

Now, the final critical step in winning the future is to make sure we aren't buried under a mountain of debt.

We are living with a legacy of deficit spending that began almost a decade ago. And in the wake of the financial crisis, some of that was necessary to keep credit flowing, save jobs, and put money in people's pockets.

But now that the worst of the recession is over, we have to confront the fact that our Government spends more than it takes in. That is not sustainable. Every day, families sacrifice to live within their means. They deserve a Government that does the same.

So tonight I am proposing that starting this year, we freeze annual domestic spending for the next 5 years. Now, this would reduce the deficit by more than $400 billion over the next decade and will bring discretionary spending to the lowest share of our economy since Dwight Eisenhower was President.

This freeze will require painful cuts. Already, we've frozen the salaries of hard-working Federal employees for the next 2 years. I've proposed cuts to things I care deeply about, like community action programs. The Secretary of Defense has also agreed to cut tens of billions of dollars in spending that he and his generals believe our military can do without.

Now, I recognize that some in this Chamber have already proposed deeper cuts, and I'm willing to eliminate whatever we can honestly afford to do without. But let's make sure that we're not doing it on the backs of our most vulnerable citizens. And let's make sure that what we're cutting is really excess weight. Cutting the deficit by gutting our investments in innovation and education is like lightening an overloaded airplane by removing its engine. It may make you feel like you're flying high at first, but it won't take long before you feel the impact. [Laughter]

Now, most of the cuts and savings I've proposed only address annual domestic spending, which represents a little more than 12 percent of our budget. To make further progress, we have to stop pretending that cutting this kind of spending alone will be enough. It won't.

The bipartisan fiscal commission I created last year made this crystal clear. I don't agree with all their proposals, but they made important progress. And their conclusion is that the only way to tackle our deficit is to cut excessive spending wherever we find it, in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes.