In Ohio, Obama defends tax stance, slams GOP

PARMA, Ohio — Appearing in the home state of one of his harshest congressional critics Wednesday, President Barack Obama defended his administration’s economic policies and accused the GOP of peddling "the same philosophy that led to this mess in the first place."

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As the final stretch of the midterm election season approaches, the Obama administration has been eager to make the case to voters that their chief concern — the economy — is also at the top of the White House's list of priorities.

Obama said that Congress should permanently extend Bush-era tax cuts for middle class families while allowing those for individuals making over $200,000 a year and households making more than $250,000 a year to expire, arguing that the country cannot afford tax cuts for the wealthy.

"With all the other budgetary pressures we have — with all the Republicans' talk about wanting to shrink the deficit — they would have us borrow $700 billion over the next ten years to give a tax cut of about $100,000 to folks who are already millionaires," said Obama, making the case that middle class families would be more likely to spend their tax savings than the wealthy, providing a better stimulus for the economy.

"Keep in mind wealthy Americans are just about the only folks who saw their incomes rise when Republicans were in charge."

He also called on lawmakers to expand, simplify and make permanent research and development tax credits and allow companies to deduct the full cost of capital investments through the end of 2011, measures he believes will encourage businesses to spend and to hire.

The choice of the Cleveland area as a venue for Wednesday’s remarks was no accident. Minority Leader John Boehner, R-Ohio, spoke there last month, laying out his party's recipe for the economy. The White House wanted to use the same turf for its rebuttal. Obama mentioned the congressman by name at least half a dozen times.

Vote: What should the government do about the economy?

Boehner, who has endorsed a two-year freeze on all tax rates and a cut in government spending to 2008 levels, responded to the president's speech by pointing to a series of suggestions proposed by Obama's former budget chief, Peter Orszag, in a New York Times op-ed Monday.

"If the president is serious about finally focusing on jobs, a good start would be taking the advice of his recently departed budget director and freezing all tax rates, coupled with cutting federal spending to where it was before all the bailouts, government takeovers, and 'stimulus' spending sprees," he said in a statement.

"What hasn't changed is the choice"
With unemployment at 9.6 percent nationwide — and higher in Ohio — the housing market still shaky and businesses and consumers wary of spending, the president used the speech to spell out his plan for kick-starting the flagging recovery.

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In addition to the small business jobs bill that Obama wants Congress to pass as the first order of business when lawmakers return next week, the president has proposed spending $50 billion immediately to improve roads, bridges, railways and runways.

The administration has resisted calling these proposals additional "stimulus", since the original $787 billion stimulus package has largely been deemed a failure — at least in a public relations sense — even though economists believe it helped lift the economy and boost employment.

Just 30 percent of those polled in the latest NBC News/Wall Street Journal survey said the stimulus made things better.

Even if these proposals make it into law in the few weeks that Congress will be in session before lawmakers hit the campaign trail again, their ability to significantly lower the jobless rate — a key barometer for worried voters — before the election is questionable.

Obama aides say that, in order to stem losses in November, they'll need to sharpen their message on what the Democratic Party has done to bring the economy back from the brink of collapse and where the Republican Party will take the country.

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The president's remarks in Ohio were reminiscent of speeches he made on the campaign trail as a presidential candidate, a period he referenced several times.

"A lot has changed since I came here in those final days of the last election, but what hasn't changed is the choice facing this country," he said. "It's still fear versus hope; the past versus the future.  It's still a choice between sliding backward and moving forward. That's what this election is about.  That's the choice that you will face in November."

The president has consistently argued a GOP takeover of Congress would mean a return to the same agenda that brought the economy to the edge of the abyss, like policies that favor corporations and the rich, while gutting regulations and consumer protections.

Still, the NBC News/Wall Street Journal poll showed just 39 percent approved of his handling of the economy and that 58 percent of those polled thought Republicans would bring new ideas.

Msnbc.com's Carrie Dann contributed.

The Associated Press and Reuters contributed to this report.