Big Business Joins Obama Effort to Aid Long-Term Unemployed

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DealBook: Obama Says Law School Should Be Two, Not Three, Years

Obama Presses for Action on Bank Rules

Aides said Mr. Obama also told the regulators that the United States needed a more simplified and certain system of financing housing. The president recently endorsed proposals to reduce the government’s role in providing mortgages.

Administration officials and some lawmakers have expressed frustration that critical parts of Mr. Obama’s overhaul of the financial system, which was voted into law three years ago and is known as the Dodd-Frank act, remain unenforced as an alphabet soup of federal agencies wrangle over how to adopt it.

In particular, top presidential aides have highlighted the failure in putting the Volcker Rule into effect. It would prohibit banks from risking institutional money in certain speculative investments. Last month, Jacob Lew, the Treasury secretary, complained in a speech that the regulators were moving too slowly to confront the dangers of banks that are so large that governments cannot allow them to fail for fear of bringing down the economy.

“If we get to the end of this year, and cannot, with an honest straight face, say that we’ve ended ‘too big to fail,’ we’re going to have to look at other options because the policy of Dodd-Frank and the policy of the administration is to end ‘too big to fail,’ ” Mr. Lew said.

The meeting on Monday was an attempt to raise those concerns directly with the agencies that are responsible for turning the law into reality. Among those in attendance were Mr. Lew; Ben S. Bernanke, the chairman of the Federal Reserve; and top officials at the Federal Housing Finance Agency, the Consumer Financial Protection Bureau, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation and the National Credit Union Administration.

Josh Earnest, a White House spokesman, said Mr. Obama wanted to convey “the sense of urgency that he feels about getting these regulations under Wall Street reform implemented promptly.”

“There are some important rules that have been put in place,” he added. “More work needs to be done.”

Congress passed Dodd-Frank in 2010 in response to the financial crisis of 2008. Since then, regulators have been working to turn the mammoth law into workable regulations, often in the face of opposition from lobbyists for banks that opposed the law.

Among the rules that have yet to be put into effect, according to Treasury Department officials, are enhanced prudential standards for banks and certain other institutions, capital and margin rules for derivatives, new mortgage disclosure regulations and the Volcker Rule. Treasury officials said they expected regulators to finish work in those areas by the end of the year.

As the banks have returned to profitability, the Obama administration has sounded increasingly impatient about the pace of bank regulation. Its desire to speed things up comes at what appears to be an opportune time. The fear that banks are too big, and could jeopardize the wider economy if they fail, is shared by people on both the left and right. Congress has introduced two bills in recent months that envision far more drastic overhauls than Dodd-Frank, both with bipartisan support.

“The politics are pretty good for the administration if they can do something on this,” Nolan McCarty, a professor of politics and public affairs at Princeton.

Some lawmakers also have expressed concern that the regulators are moving too slowly. Senator Elizabeth Warren, Democrat of Massachusetts, and several other senators have proposed new laws that would reinstate a firewall between banks and investment firms like those in the Depression-era Glass-Steagall Act.

Senators David Vitter, Republican of Louisiana, and Sherrod Brown, Democrat of Ohio, have introduced separate legislation that would increase the amount of capital that the nation’s biggest banks are required to carry.

“For too long, financial watchdogs were asleep on the job, allowing Wall Street megabanks to become too complex to manage and regulate and ‘too big to fail,’ ” said a spokeswoman for Senator Brown.

She said Senator Brown was “hopeful that today’s meeting will lead to progress in ensuring that taxpayers and our financial system are no longer threatened by ‘too big to fail’ banks.”

The administration may also want to sound the right notes as the financial crisis’s fifth anniversary approaches. The bankruptcy of Lehman Brothers, the event blamed for paralyzing the world financial system, occurred on Sept. 15, 2008. The fact that many rules have not been completed so long after Lehman’s failure could be a source of embarrassment to the administration and regulators.

“They certainly don’t want that story dominating things over the next couple of months,” said Marcus Stanley, policy director of Americans for Financial Reform, a group that has called for stricter regulation of financial firms.

Michael D. Shear reported from Washington and Peter Eavis from New York.

Bits Blog: Obama Administration Overturns Ban on Apple Products

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Obama Outlines Plans for Fannie Mae and Freddie Mac

He proposed to “wind down” Fannie Mae and Freddie Mac, for the first time outlining his approach to overhauling the two giant mortgage-finance companies that were taken over by the government when they failed nearly five years ago. The companies, which Mr. Obama described in an appearance here as “not really government, but not really private sector,” recently began to repay taxpayers.

“For too long, these companies were allowed to make big profits buying mortgages, knowing that if their bets went bad, taxpayers would be left holding the bag,” the president said. “It was ‘heads we win, tails you lose.’ ”

Since early 2011, the administration has voiced support for overhauling Fannie Mae and Freddie Mac, which long benefited from an implicit government guarantee. Years ago the companies came to symbolize a self-dealing Washington culture beneficial to both parties, and especially Democrats, but Mr. Obama’s remarks on what comes next were his most specific. For several years, the administration held back from revamping the mortgage-finance system for fear of rattling a weakened market.

Mr. Obama on Tuesday endorsed the thrust of bipartisan legislation from a Senate group that would “end Fannie and Freddie as we know them.” The so-called government-sponsored enterprises for decades bought and sold mortgages from financial institutions to provide money for the banks to keep lending to home buyers.

Under Mr. Obama’s principles, which he said were reflected in the Senate bill taking shape, Fannie Mae and Freddie Mac would further shrink their portfolios and lose the implicit guarantee of a federal government bailout. Instead, private investors would be most at risk, with the government a secondary guarantor.

“First, private capital should take a bigger role in the mortgage markets. I know that sounds confusing to folks who call me a socialist,” Mr. Obama said, drawing laughs and applause. “I believe that our housing system should operate where there’s a limited government role,” he added, “and private lending should be the backbone of the housing market.”

The president said that any measure he signed into law “should preserve access to safe and simple mortgage products like the 30-year, fixed-rate mortgage.”

“That’s something families should be able to rely on when they’re making the most important purchase of their lives,” he said.

Senator Mark Warner, Democrat of Virginia who is part of the bipartisan effort on the Senate banking committee, welcomed the president’s endorsement. “It’s good to see additional momentum,” he said in a statement.

Brian Gardner, a senior vice president in Washington at Keefe, Bruyette & Woods, wrote to clients that Mr. Obama’s address on mortgage finance was “important because the administration has not discussed it in some time.” Despite the presidential push, he said, Congress is not likely to approve a bill before 2015.

Separate legislation in the Republican-controlled House would remove the government from the mortgage market, including from the decision whether to keep providing the 30-year mortgage. But Mr. Gardner wrote that even “many free market proponents acknowledge that the government will play some backstop role in a future system” and be compensated for it.

After years in which the formerly formidable Fannie Mae and Freddie Mac and their Congressional allies blocked proposals requiring some kind of fees or risk premiums, Mr. Obama is calling for an assessment to be paid to the government on the value of mortgage-backed securities.

Under his proposals, the revenue from an assessment would help finance aid for borrowers and the construction of houses and rental properties that lower-income Americans could afford.

Mr. Obama’s focus was homeownership. But he emphasized the need for more affordable rental housing more than he had before. Advocates have called for a “rebalance” of government subsidies, which they say have too long been skewed toward homeownership and mostly benefit the affluent.

“In the run-up to the crisis, banks and the government too often made everyone feel like they had to own a home, even if they weren’t ready and didn’t have the payment,” Mr. Obama said. “That’s a mistake we shouldn’t repeat,” he said. “Instead, let’s invest in affordable rental housing.”

Mr. Obama purposely spoke in Phoenix, where weeks after taking office he first announced his ideas for providing relief to homeowners and stemming foreclosures. Here, as in much of the nation, home values and sales are up, and foreclosures are down. Before arriving at a high school gym packed with an enthusiastic crowd, he visited a housing construction company that has quintupled its work force since the bust.

But as he often does, Mr. Obama tempered his celebration of better times, and his administration’s role in helping to reach them, with acknowledgment that the recovery was not complete.

“The truth is, it’s been a long, slow process,” he conceded. “But during that time we’ve helped millions of Americans save an average of $3,000 each year by refinancing at lower rates. We’ve helped millions of responsible homeowners stay in their homes, which was good for their neighbors because you don’t want a bunch of foreclosure signs in your neighborhood.”

Obama Says Income Gap Is Fraying U.S. Social Fabric

Upward mobility, Mr. Obama said in a 40-minute interview with The New York Times, “was part and parcel of who we were as Americans.”

“And that’s what’s been eroding over the last 20, 30 years, well before the financial crisis,” he added.

“If we don’t do anything, then growth will be slower than it should be. Unemployment will not go down as fast as it should. Income inequality will continue to rise,” he said. “That’s not a future that we should accept.”

A few days after the acquittal in the Trayvon Martin case prompted him to speak about being a black man in America, Mr. Obama said the country’s struggle over race would not be eased until the political process in Washington began addressing the fear of many people that financial stability is unattainable.

“Racial tensions won’t get better; they may get worse, because people will feel as if they’ve got to compete with some other group to get scraps from a shrinking pot,” Mr. Obama said. “If the economy is growing, everybody feels invested. Everybody feels as if we’re rolling in the same direction.”

Mr. Obama, who this fall will choose a new chairman of the Federal Reserve to share economic stewardship, expressed confidence that the trends could be reversed with the right policies.

The economy is “far stronger” than four years ago, he said, yet many people who write to him still do not feel secure about their future, even as their current situation recovers.

“That’s what people sense,” he said. “That’s why people are anxious. That’s why people are frustrated.”

During much of the interview, Mr. Obama was philosophical about historical and economic forces that he said were tearing at communities across the country. He noted at one point that he has in the Oval Office a framed copy of the original program from the March on Washington for Jobs and Freedom 50 years ago, when the Rev. Dr. Martin Luther King Jr. gave his “I Have a Dream” speech.

He uses it, he said, to remind people “that was a march for jobs and justice; that there was a massive economic component to that. When you think about the coalition that brought about civil rights, it wasn’t just folks who believed in racial equality. It was people who believed in working folks having a fair shot.”

For decades after, Mr. Obama said, in places like Galesburg people “who wanted to find a job — they could go get a job.”

“They could go get it at the Maytag plant,” he said. “They could go get it with the railroad. It might be hard work, it might be tough work, but they could buy a house with it.”

Without a shift in Washington to encourage growth over “damaging” austerity, he added, not only would the middle class shrink, but in turn, contentious issues like trade, climate change and immigration could become harder to address.

Striking a feisty note at times, he vowed not to be cowed by his Republican adversaries in Congress and said he was willing to stretch the limits of his powers to change the direction of the debate in Washington.

“I will seize any opportunity I can find to work with Congress to strengthen the middle class, improve their prospects, improve their security,” Mr. Obama said. But he added, “I’m not just going to sit back if the only message from some of these folks is no on everything, and sit around and twiddle my thumbs for the next 1,200 days.”

Addressing for the first time one of his most anticipated decisions, Mr. Obama said he had narrowed his choice to succeed Ben S. Bernanke as chairman of the Federal Reserve to “some extraordinary candidates.” With current fiscal policy measurably slowing the recovery, many in business and finance have looked to the Fed to continue its expansionary monetary policies to offset the drag.

Mr. Obama said he wanted someone who would not just work abstractly to keep inflation in check and ensure stability in the markets. “The idea is to promote those things in service of the lives of ordinary Americans getting better,” he said. “I want a Fed chairman that can step back and look at that objectively and say, Let’s make sure that we’re growing the economy.”

The leading Fed candidates are believed to be Lawrence H. Summers, Mr. Obama’s former White House economic adviser and President Bill Clinton’s Treasury secretary, and Janet Yellen, the current Fed vice chairwoman and another former Clinton official. The president said he would announce his choice “over the next several months.”

For Obama, Another Round With the Economy

It may also be a reflection of how little the president — any president — can do to alter the country’s economic trajectory while he is faced with global forces that shape the financial system in the United States, as well as a domestic political system that has ground to a standstill, particularly over economic issues like taxes and spending.

The new public relations effort, which begins with a major address Wednesday and as many as six economic-themed speeches over the next two months, is intended to give Mr. Obama a chance to claim credit for the improving economy and to lift his rhetoric beyond the Beltway squabbles that have often consumed his presidency.

But the speeches will not contain big new proposals, senior administration officials said Monday, speaking to reporters on the condition that they not be quoted. Nor are they designed to break the hardening stalemate on economic issues between a president and his Republican adversaries in Congress. Instead, they will repackage economic proposals that the president has offered for years — sometimes in new formats, the officials said.

“The point is to chart a course for where America needs to go,” Dan Pfeiffer, the president’s senior adviser, said in an e-mail to the president’s supporters Sunday night. Officials said that course has improved significantly during Mr. Obama’s administration, giving Americans a sense of stability, if not complete economic security.

Mr. Obama’s adversaries on Monday were quick to point out that the president has frequently launched similar efforts to redefine or restate his economic agenda, often accompanied by rhetoric from his advisers about a new direction or emphasis. Most have run headfirst into opposition on Capitol Hill.

In the fall of 2011, Mr. Obama addressed a joint session of Congress to unveil a $447 billion jobs bill that has not passed. In 2012, as his re-election campaign neared its end, Mr. Obama renewed his vision with a 20-page economic plan. In his State of the Union speech in February, the president refocused on the economy after beginning his second term focused on gun control, immigration, climate change and gay rights.

And just this past May, Mr. Obama announced he was restarting his “Middle Class Jobs and Opportunity Tour,” with stops in Baltimore and Austin.

“They’ve been saying the same thing for four years,” said Don Stewart, a spokesman for Senator Mitch McConnell, the minority leader in the Senate. “The previous Democrat Congress passed his agenda — Obamacare, the stimulus, thousands of pages of regulations — and the economy is treading water. More taxes, more regulation, and more failures to unleash American energy jobs are not the answer.”

Republicans say Mr. Obama should have spent less time passing health care legislation early in his presidency and more time improving the economic fortunes of Americans.

“Memo to Obama and the White House: speeches don’t create jobs,” said Kirsten Kukowski, a spokeswoman for the Republican National Committee.

Senior administration officials on Monday conceded that the president was partly to blame for the Washington conversation veering away from the economic issues that many Americans believe are the most important. One official said that it was incumbent on Mr. Obama to shift the overall focus of the debate in Washington, and that has not happened.

In some cases, the White House has chosen to spend its time and political capital on other topics. Mr. Obama made it clear early this year that he wanted Congress to make a major push to pass an overhaul of the nation’s immigration system. The president also responded to the shooting of 20 children at Sandy Hook Elementary School by calling for broad new gun laws. His allies argue that the health care law and an immigration overhaul will help the economy, and they blame Republicans for blocking many of Mr. Obama’s economic policies.

But officials also criticized Republicans, especially in the House, for seizing on what the White House says are overblown scandals: the targeting of nonprofit groups at the Internal Revenue Service and the actions of officials in the wake of the attacks in Benghazi, Libya.

And they noted that some of the distractions in Washington have been out of Mr. Obama’s control. When oil spilled from the Deepwater Horizon well in the Gulf of Mexico in the summer of 2010, it consumed the White House for weeks. Hurricane Sandy’s destruction late last year and the tornadoes in Oklahoma City in May required presidential attention, as did tensions in the Middle East. Even the verdict in the Trayvon Martin case prompted presidential remarks on Friday.

Administration officials said the timing of the speeches was broadly related to the looming fiscal deadlines that are likely to spark bitter fights in Congress later this fall. Republicans are already promising big fights over extension of the nation’s debt limit and new budget battles.

But Mr. Obama’s aides said that the president wanted to avoid using the speeches as a negotiating platform over legislative programs. They said he would talk about housing, jobs, education, retirement and health. But they cautioned reporters not to expect a Congressional to-do list from Mr. Obama.

That decision is driven, the president’s top aides said, by a conclusion that there are no magic answers that will accelerate the economy’s recovery or help provide jobs to the millions of people who are still having trouble finding one.

Administration officials said they hoped Mr. Obama’s speeches would help frame the contours of a conversation that was broader than the Congressional debates in Washington, in part by reaching out to Americans, business owners and others.

Obama Calls Surveillance Programs Legal and Limited

Christopher Gregory/The New York TimesObama Defends Surveillance Programs: President Obama defends and explains a National Security Agency program that monitors domestic and international phone records.

Off the Charts: S.&P. Has More Than Doubled Under Obama

Through Friday, more than 52 months after he took office, the index was up 105 percent during his term in office, for a compound annual gain of 18 percent.

There is, of course, more than a little good fortune in that statistic. Mr. Obama took office on Jan. 20, 2009, in the middle of a credit crisis that had caused prices to plunge and would cause them to keep falling for a few more weeks. It helps to start from a very low level. It also helps to have a central bank that drove short-term interest rates to zero, a step that both increased corporate profits and made bonds less attractive investments.

In fact, the United States stock market fell from record high levels this week, and world markets quavered, in part because of comments made by the Federal Reserve chairman, Ben Bernanke, that the Fed might be able to begin to back off from its aggressive monetary stance later this year.

Even with this week’s dip, however, the United States market has done better since early 2009 than any of the next nine largest economies in the world, as can be seen in the accompanying charts. Those charts reflect MSCI indexes, based in dollars, in each country except the United States, where the S.& P. 500 is used.

The United States market lagged many others early in the recovery. But as its economy kept growing, albeit slowly, and European economies faltered and worries grew that emerging economies might experience slower growth, the American market overtook the others.

Of the next nine — ranked on the size of the economies in 2009, only India’s market came close to the performance of the United States market since early 2009. Like the Chinese and Brazilian markets, it excelled early on but is now well below the peak it hit in 2011.

If you put your dollars into the Italian or Spanish stock markets when Mr. Obama took office, your shares would now be worth less than you paid for them. Over all, the world’s stock markets outside the United States have risen less than two-thirds as much as the American one has.

The Wall Street performance has not made Mr. Obama particularly popular among financiers. Indeed, some of the language about the president’s perceived support of socialism and hostility to capitalism during last year’s campaign was the harshest seen in any campaign since 1936, when Franklin D. Roosevelt was seeking a second term and was strongly opposed by many financiers.

By the time Mr. Roosevelt died in 1945, the S.& P. 500 was 141 percent higher than it had been when he took office. But he was in office so long that the annual rate of gain was only 7.5 percent, less than half of the rate so far for the Obama administration.

The other presidents whose term in office included a doubling in the S.& P. were Dwight D. Eisenhower, Ronald Reagan and Bill Clinton. Each served two full terms, and none came close to the average annual gain so far under Mr. Obama. Mr. Clinton’s 15.2 percent was the highest of that group. He had the good fortune to enter office when markets were relatively low and to leave just as the technology stock bubble was starting to collapse.

There is, of course, no guarantee that a market that rises will endure. Mr. Roosevelt’s record would be better if he had left after one term in office; the market was lower when he died in 1945 than it had been when he took the oath of office in 1937 for his second term.

And the president with the best stock market record in the 20th century — using the Dow Jones industrial average, whose history is longer than that of the S.& P. — is Calvin Coolidge. The Dow rose 256 percent — an annual rate of 25.5 percent — from his inauguration in 1923 until he left office in early 1929. The market went up an additional 20 percent before the crash. But by the end of 1931 all of the Coolidge gains had been lost.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

Budget Office Says Obama Plan Would Cut Deficit by $1 Trillion

But the proposal, which was released just last month, has already been mostly forgotten in Washington. Senate Democrats and House Republicans have not agreed to come to the table to split the difference between their budgets, either. After two years of knock-down, drag-out fights over taxes and spending, the budget has been put on the back burner, at least for now.

In part that is because the gap between spending and revenue has started to shrink substantially, in response to earlier tax increases, spending cuts and a strengthening economy. Earlier this week, the budget office sharply cut its estimate of the current fiscal-year deficit by more than $200 billion, on higher-than-anticipated tax receipts and big payments to the Treasury from Fannie Mae and Freddie Mac, the mortgage financiers. Were Congress to do nothing and the economy avoid running into a ditch, the deficit would fall to just over 2 percent of economic output in 2015.

It is also because the series of automatic cuts, ceilings and self-imposed crises have for the most part ended. The so-called fiscal cliff was avoided when at the beginning of the year Congress managed to pass a more-moderate package of tax increases and cuts. The $85 billion in cuts to domestic and military programs known as sequestration has already hit, with lawmakers doing little to change them.

That has left nothing on the horizon to force Congress’s hand until it needs to raise the debt ceiling, a statutory borrowing limit. But because of strong tax receipts and the sequestration spending cuts, it might not need to tackle that issue until October or even later.

Separately, lawmakers and the White House have focused their attention on other priorities, particularly gun laws, immigration reform and a series of scandals. This week, for instance, it was a fracas over the revelation that Internal Revenue Service employees targeted conservative groups seeking tax-exempt status.

But some members of Congress, along with President Obama, are still vowing to tackle the country’s long-term deficits even though there is no imminent threat. Without Congressional action, the deficit, as measured as a proportion of economic output, could start rising again in the latter half of the decade, the Congressional Budget Office warned again this week. If health care spending starts rising again sharply and debt payments soar as interest rates rise, many experts fear that those costs will eventually crowd out financing for the government’s other priorities.

“It is encouraging to see that the president’s proposals would indeed begin to reduce the debt, and to lower levels than originally thought,” said Maya MacGuineas of the Committee for a Responsible Federal Budget, a budget watchdog, in a statement responding to the new budget office estimate. “Regardless, additional reforms will be needed over the long-term, especially to slow the growth of health care programs and shore up Social Security,” she said.

On some issues, Republicans and Democrats are closer than their heated rhetoric might let on. For instance, Mr. Obama included in his budget proposal cuts to Social Security and Medicare that are anathema for many Democrats, showing a willingness to spread the political pain as part of a larger budget deal in a bid to encourage Republicans to bargain. One major change would alter the calculation used to ensure that Social Security payments kept up with the pace of inflation, providing less money to seniors over time.

His proposal also includes almost $1 trillion in tax increases, by further limiting the deductions and exclusions high-income families can claim, increasing taxes on tobacco and introducing the so-called Buffett Rule, a new minimum tax on income over $1 million. Republicans have refused to consider changes to increase revenue, arguing that money raised from closing loopholes should be used to bring down overall tax rates.

Mr. Obama’s proposal would widen deficits slightly in the fiscal years 2013 through 2015, the budget office said, but trim them later on. Starting in 2014, his tax increases would lift revenue gradually from about $27 billion to $155 billion a year. Spending would increase by as much as $142 billion a year until 2018, when it would decline beneath the levels indicated by current law.

The two parties are principally at odds over priorities like infrastructure, science, agriculture and education, and on Medicaid, the health care program for the poor and disabled.

In 2023, the House Republicans plan would put the level of Social Security and Medicare spending very close to where the White House would — about 8.7 or 8.8 percent of economic output, according to an analysis by Douglas W. Elmendorf, the director of the budget office. Mr. Obama is calling for modestly smaller military spending, at 2.4 percent of economic output, compared with the House Republicans’ 2.7 percent.

The White House would spend 7.7 percent on everything else, including housing programs, unemployment insurance, Medicaid, health insurance subsidies and education. The House would spend just 5.2 percent.

The Congressional Budget Office does not analyze Congressional budget resolutions. The House and Senate budget committees put forward revenue and spending estimates of their own plans based on Congressional Budget Office data, but both plans lack a lot of detail.

When it released its plan, the Obama White House claimed that it saved $1.8 trillion over 10 years. The divergence between its estimate and the budget office’s stems from the fact that the White House assumed the $85 billion in automatic budget cuts would be repealed or replaced with a new policy. The budget office did not.

Other than that, the independent office’s assessment of how the budget proposal would affect spending and revenue differs only marginally from the White House’s own.

Obama Promotes Ambitious Plan to Overhaul Nation’s Infrastructure

At the end of a week absorbed by social issues like gun control and gay rights, the president returned to the economic challenges he has called his top priorities with a set of proposals to generate money for construction projects.

“What are we waiting for?” Mr. Obama asked, surrounded by massive cranes and cargo containers. “There’s work to be done. There are workers who are ready to do it. Let’s prove to the world that there’s no better place to do business than right here in the United States of America, and let’s get started rebuilding America.”

Expanding on ideas from his first term and this year’s State of the Union address, Mr. Obama proposed a series of tax breaks and loans to stimulate private investment. Among other things, new “America Fast Forward Bonds” would help state and local governments borrow money for projects, while foreign pension and retirement funds would have a tax penalty eliminated so they could invest in infrastructure in the United States on a similar basis as American funds. Grant programs that were part of the president’s stimulus program would be expanded by $4 billion.

Mr. Obama also promoted an infrastructure bank that would use $10 billion in public money to leverage private investment, a concept he has been pushing without success since 2011.

Republicans responded by saying they also wanted to upgrade American roads, bridges and other infrastructure, but only if it could be paid for. SpeakerJohn A. Boehner’s office distributed comments he made last month after Mr. Obama’s State of the Union address.

“It’s easy to go out there and be Santa Claus and talk about all the things you want to give away,” Mr. Boehner said. “But at some point, somebody has to pay the bill.”

Infrastructure has been one of Mr. Obama’s favorite talking points because its appeal often crosses party lines. Both labor unions and corporations favor more spending on airports, highways and the like, and both Republican and Democratic lawmakers are eager for projects in their districts.

Ken Orski, the editor of Innovation NewsBriefs, a transportation newsletter, said the president’s emphasis on private investment was important. “We need more of that kind of involvement, rather than exclusive emphasis on public financing,” he said.

In some ways, expanding private investment in such projects is a return to tradition, said Mr. Orski, a transportation official under PresidentsRichard M. NixonandGerald R. Ford. Going back to the 19th century, canals and toll roads were financed with private money, he noted. But the great flow of government spending during the New Deal and the creation of the Interstate highway system shifted assumptions.

So while some industries like freight rail, telecommunications and aviation have depended largely on private investment, other infrastructure financing has come largely from government sources. Now that sensibility is shifting again, with more private money in the past 20 years.

“Many people feel that the role of private capital in infrastructure has been de-emphasized too much and that more balance should be restored to the equation,” Mr. Orski said.

The latest national report card issued by the American Society of Civil Engineers this month on the state of bridges, roads, power grids, rail networks and other systems showed that the country’s grade had actually risen for the first time — but to a D-plus from a D. The group credited an increase of private investment and spending from Mr. Obama’s stimulus program.

PortMiami is in the midst of $2 billion in improvements, including a tunnel directly linking its facilities with the Interstate highway system. Workers are also dredging to provide access to larger vessels, reconnecting the port with the nation’s rail system, upgrading its cranes and strengthening its bulkheads. Some of the cost has been financed with federal loans.

“The Port of Miami is a tremendous example of how infrastructure investment can lead to economic prosperity,” said Gregory E. DiLoreto, president of the engineers’ society.

On Thursday, Gov. Rick Scott, a Republican, chided Mr. Obama during a conference call with reporters for following the lead of states like Florida.

“We’re certainly glad President Obama’s coming to the Port of Miami tomorrow,” Mr. Scott said, “but he’s late to the party on Florida port investments.” He said his administration had fronted part of the federal cost of the PortMiami project when Washington dawdled. “We could not wait for the federal government to come to the table with their share of the project,” he said

Peter Baker reported from Miami, and John Schwartz from New York.

Obama Announces 3 Cabinet Nominations

Mr. Obama introduced Sylvia Mathews Burwell, the president of the Walmart Foundation in Arkansas and a familiar figure in the Democratic administration from her service in the Clinton administration, to be the director of the White House Office of Management and Budget.

Ernest J. Moniz, the director of the Massachusetts Institute of Technology’s Energy Initiative, is the president’s choice to take over for Steven Chu at the Energy Department. And Gina McCarthy, the assistant administrator in charge of air and radiation at the Environmental Protection Agency, is the pick to replace the departing administrator, Lisa P. Jackson. All three positions are subject to Senate confirmation.

Ms. McCarthy most likely faces the greatest scrutiny given Republicans’ opposition to Mr. Obama’s environmental and climate policies.

“I hope the Senate will confirm them as soon as possible,” Mr. Obama said as he introduced the three nominees and thanked the current holders of the cabinet posts in the East Room, which was packed with family, friends and administration staff members.

Mr. Obama described Dr. Moniz as “another brilliant scientist” to succeed Dr. Chu, a Nobel Prize-winning physicist, at the Energy Department. And for the E.P.A., the president said Ms. McCarthy was well suited with her experience as a state environmental official in both Massachusetts — for former Gov. Mitt Romney — and Connecticut. She has “a reputation as a straight-shooter” who “welcomes different points of view,” he added.

Together, Ms. McCarthy and Dr. Moniz are “going to be making sure that we’re investing in American energy, that we’re doing everything that we can to combat the threat of climate change, that we’re going to be creating jobs and economic opportunity in the first place,” Mr. Obama said, implicitly addressing the criticism, especially from Republicans, that environmental policies inhibit the economy.

The applause that greeted Ms. Burwell as the budget nominee reflected how familiar she remains, having served President Bill Clinton at the budget office, where she was the deputy director, as well as at the Treasury Department and in the White House. In that time, she worked closely with Jacob J. Lew, now Mr. Obama’s Treasury secretary, who recommended Ms. Burwell for the budget director’s job, which he held for both Mr. Clinton and Mr. Obama. Since then, Ms. Burwell has lived far from Washington, first in Washington State during her time leading global development programs for the Gates Foundation and then in Bentonville, Ark., Walmart’s headquarters.

Mr. Obama used his announcement of Ms. Burwell’s nomination to once more address the across-the-board cuts to military and domestic spending, known as sequestration, that took effect on Friday, after he and Congressional Republicans failed to agree on a more deliberate set of deficit reduction actions.

She and the acting budget director, Jeffrey D. Zients, “will do everything in their power to blunt the impact of these cuts on businesses and middle-class families,” the president said. “But eventually a lot of people are going to feel some pain. That’s why we’ve got to keep on working to reduce our deficit in a balanced way.”

Mr. Obama also hinted that he would find another post in his administration for Mr. Zients, a former business executive, who is well respected within the White House. He has been mentioned as a possible nominee to be Mr. Obama’s trade representative or commerce secretary — two of the last cabinet posts that Mr. Obama must fill to complete his second-term team.

“I expect he will continue to serve us well in the future,” Mr. Obama said.

Matthew L. Wald contributed reporting.

This article has been revised to reflect the following correction:

Correction: March 4, 2013

An earlier version of this article misspelled in some references the surname of the president’s pick to lead the Energy Department. He is Ernest J. Moniz, not Muniz.

House G.O.P. Looks to a Round 2 Obama Hopes to Avoid

“I will not have another debate with this Congress over whether or not they should pay the bills that they’ve already racked up through the laws that they passed,” the president said, pausing to repeat himself. “We can’t not pay bills that we’ve already incurred.”

But it is not clear exactly how Mr. Obama can avoid engaging in just such a tug of war.

In the wake of the president’s victory on taxes over the New Year’s holiday, Republicans in Congress are betting that by refusing to unconditionally raise the $16.4 trillion debt ceiling, they can force Mr. Obama to the bargaining table on spending cuts and issues like reform of Medicare and Social Security.

That would inevitably reprise the bitter clash over the debt ceiling in the summer of 2011, when the government came close to shutting down before lawmakers and the president agreed to a $1.2 trillion package of spending cuts in exchange for Republican agreement to raise the debt ceiling by about the same amount.

And that is exactly what Republicans want.

The party’s caucus in the House will discuss its debt ceiling strategy at its retreat in Williamsburg, Va., in a couple of weeks, according to a top Republican aide, who said it was determined to insist again on spending cuts that equal the increase in the amount the country can borrow.

“The speaker told the president to his face that everything you want in life comes with a price. That doesn’t change here,” the Republican aide said. “I don’t think he has any choice.”

That strategy could risk a new round of criticism aimed at Republicans from a public weary of brinkmanship. The 2011 fight ended with a last-minute deal but led to a downgrade in the rating of the nation’s debt and a slump in the economic recovery.

But Brendan Buck, a spokesman for Speaker John A. Boehner, said Republicans had made it clear what they wanted in exchange for a willingness to allow borrowing to increase.

“If they want to get the debt limit raised, they are going to have to engage and accept that reality,” Mr. Buck said. “The president knows that.”

In fact, the White House has been on notice for months that Republicans view the debt ceiling as leverage in the next budget fight. Now, the question is what Mr. Obama and his advisers can do to sidestep that fight.

One possibility is to turn to business executives for support. Many top chief executives view the possibility of a debt ceiling crisis as a significant impediment to the nation’s economy just as it is beginning to grow again. Those executives might try to pressure Republican lawmakers not to use the country’s credit as a negotiating tool.

Mr. Obama might also take to the road again, using the power of his office to try to convince the public that another fight over the debt ceiling risks another economic crisis. Public polls after the last debt ceiling fight suggested that more people blamed Republicans for the threat of a default.

The president and his aides have signaled that they will try to educate the public by explaining that the increase in the borrowing limit is necessary to cover debts that the government has already incurred. In his statement on Tuesday night, Mr. Obama warned about what would happen if the country did not meet its obligations.

“If Congress refuses to give the United States government the ability to pay these bills on time, the consequences for the entire global economy would be catastrophic — far worse than the impact of a fiscal cliff,” Mr. Obama said.

In the coming days and weeks, Mr. Obama is likely to try to focus negotiations on the other looming issue: how to avoid deep across-the-board cuts to the nation’s military and domestic programs. The deal passed on Tuesday postpones those cuts for two months, but Mr. Obama and lawmakers in both parties are eager to avoid them.

Instead, the president wants a debate over spending cuts and tax changes that would remove loopholes and deductions for wealthy Americans.

That fight is coming. The question is whether the president can avoid conducting it in the middle of a nasty, drawn-out debate over the debt limit.

Obama Tells G.O.P. Not to Tie Debt Ceiling to Fiscal Debate

In a speech to the Business Roundtable, Mr. Obama called that irresponsible. “That is a bad strategy for America, it’s a bad strategy for your businesses and it is not a game that I will play,” he said. “Everybody here is concerned about uncertainty. There’s no uncertainty like the prospect that the United States of America, the largest economy, that holds the world’s reserve currency, potentially defaults on its debts.”

While saying he would not “play that game,” a phrase he repeated, Mr. Obama did not say what he would do in response, but some Democrats have urged him in the past to simply raise the borrowing limit using his own executive authority and let the courts determine if he overstepped his constitutional bounds.

He seemed to embrace a suggestion by John Engler, the Business Roundtable president, to raise the debt ceiling enough to last five years. “John is exactly right when he says that the only thing that the debt ceiling is good for as a weapon is just to destroy your credit rating,” Mr. Obama said.

Mr. Obama was reacting to reports that Republican leadership officials were looking for a fallback in the current debate to avert an end-of-the-year fiscal crisis. Some Republicans foresee accepting Mr. Obama’s call to extend Bush-era tax cuts for the middle class while allowing them to expire for the wealthiest Americans, and then taking up the fight again when the nation’s debt rises to the point that the statutory borrowing limit needs to be raised again, which could be in late January or February.

Republicans view any vote to raise the debt ceiling as a chance to enforce more fiscal discipline on Mr. Obama. Speaker John A. Boehner has said any increase in borrowing capacity should be offset by spending cuts that exceed the increased debt. Mr. Obama has responded by proposing to take away the Congressional power to approve increases in the debt ceiling, but Mr. Boehner said last weekend that “Congress is never going to give up this power.”

Appearing before reporters on Wednesday, Mr. Boehner and other House Republican leaders implored Mr. Obama to sit down with them and begin negotiating in earnest to head off the looming fiscal crisis, but with flattery and aggravation, they made it clear that they were now playing on his turf.

Mr. Boehner and his leadership team did not give an inch on their opposition to raising tax rates on the wealthy or their insistence that any deficit-reduction plan emphasize spending cuts. But the speaker sounded exasperated as he insisted that he had moved toward the president’s position by agreeing to $800 billion in higher tax revenue over 10 years.

“The revenues we’re putting on the table will come from guess who? The rich,” he said, his voice rising. “There are ways to limit deductions, close loopholes and have the same people pay more of their money to the federal government without raising tax rates.”

Representative Peter Roskam of Illinois, a member of the Republican leadership, appealed to Mr. Obama’s own view of himself as a politician able to rise above partisanship, a characterization Republicans have rarely, if ever, agreed with.

“I’ve seen an attribute in President Obama when we served together in the Illinois State Senate, where he was able to rise above donkeys and elephants and transform some very controversial issues in a way that was powerful,” Mr. Roskam said, imploring the president to eschew the politics of the victor and seize “an unbelievable opportunity to be a transformational president, that is to bring the country together.”

The dueling public appearances underscored how far apart the two sides were, at least as a matter of principle. Mr. Obama’s plan calls for $1.6 trillion in new taxes over 10 years, mainly through allowing rates to rise on income above $200,000 a year for individuals or $250,000 for families. He has also revived a year-old plan to trim health care and other mandatory spending by $600 billion over 10 years, but he also wants to spend $50 billion in the short term to help the economy.

Common Sense: Comparing the Tax Bite With Obama and Romney

Would you pay more or less in tax? And how would that stack up against the richest Americans like Warren Buffett, who’s currently paying a lower rate than his secretary?

Considering how central these issues have been to the campaign, it’s curious how hard it is to come up with answers, perhaps because both candidates want voters to believe that someone’s else’s taxes may have to rise, but not theirs. Whether Mr. Romney’s math adds up and whether taxing the rich would make a dent in the deficit might make an interesting public policy debate, but those issues further obscure the most basic question, which is what effect the proposals will have on each of us.

I’m not saying voters should simply vote their pocketbooks. But I would at least like to know how much I’m being asked to pay and what I might expect in return. This has been especially true since I discovered this year that I paid a rate in federal income tax that’s nearly twice as high as Mr. Romney’s. As I said then, I’m not faulting Mr. Romney for taking advantage of the existing tax code, but that disparity continues to rankle.

Tax reform and the related issue of economic growth have been major themes in the campaign that will end on Tuesday. The economy has taken center stage, and both candidates have been making much of tax platforms that aim to spur growth and job creation while promoting fairness. Mr. Romney has been the more ambitious, calling for sweeping tax reform that would lower rates while broadening the base by limiting unspecified deductions and loopholes. “Tax policy shapes almost everything individuals and enterprises do as they participate in the economy,” he says on his “Mitt Romney for President” Web site.

President Obama has called for a return to the top rates that prevailed in the Clinton administration and higher rates on capital gains and dividends. “We can’t get this done unless we also ask the wealthiest households to pay higher taxes on their incomes above $250,000 — pay the same rate we had when Bill Clinton was president,” Mr. Obama said last month while campaigning in New Hampshire. “We created 23 million new jobs, and we went from a deficit to surplus. That’s how you do it.”

So what would the impact of their tax proposals be? After consulting several tax experts, I did the calculations both on my own returns for 2009 and 2011 as well as for the wealthiest 400 taxpayers.

For the Romney plan, I took the proposals from his Web site that apply to taxpayers with adjusted gross incomes over $200,000: a 20 percent cut in the top rate (to 28 percent from 35 percent); dividends and capital gains taxed at the existing preferential rate of 15 percent; and the abolition of the alternative minimum tax. Mr. Romney hasn’t said what itemized deductions he would abolish or limit, but he has said he might cap or eliminate those deductions for high-income taxpayers.

Mr. Romney has mentioned a cap on deductions of $17,000, and has also said: “One way, for instance, would be to have a single number. Make up a number, $25,000, $50,000. Anybody can have deductions up to that amount And then that number disappears for high-income people,” meaning high-income people would be allowed no itemized deductions.

So in the spirit of Mr. Romney’s comments, I eliminated all itemized deductions. I retained the self-employed health insurance deduction and the deduction for contributions to a qualifying retirement plan. So far as I can tell, Mr. Romney hasn’t proposed abolishing those.

I took Mr. Obama’s tax proposals from his proposed budget and subsequent campaign statements, in which he has called for a return to Clinton era rates of 36 percent (for single taxpayers in roughly the $200,000 to $400,000 bracket) and 39.6 percent for those earning over $400,000 for both ordinary and dividend income and a 20 percent rate on capital gains. While Mr. Obama has talked about repealing the A.M.T., he hasn’t actually proposed doing so and has only suggested indexing it to inflation, so I retained the A.M.T. in the Obama calculations.

I assumed the Obama proposals would raise my rate and the Romney plan would lower it. But the Romney plan actually increased my rate to 25.5 percent from 22.2 percent in 2011, and to 27.6 percent from 26.7 percent in 2009. The Obama plan raised it even more substantially, to 30.6 percent in 2011 and 29.3 percent in 2009.

Including the minimum tax in the Obama plan had a significant impact. If Mr. Obama abolished it, my rate under his plan fell to 29.7 percent in 2011 and to 26.7 percent in 2009 — lower than the Romney plan, in fact, in 2009. If Mr. Romney allowed me the $17,000 in itemized deductions he has mentioned, it would have only a negligible impact, lowering my rates 0.5 percent.

In Campaign Donations, DLA Piper Skews Toward Obama

Lawyers at the nation's biggest law firms are voting with their wallets - and President Obama is the clear winner.

Obama and Romney Hold First Debate

Mitt Romney and President Obama challenged each other on many issues.

DENVER — Mitt Romney on Wednesday accused President Obama of failing to lead the country out of the deepest economic downturn since the Great Depression, using the first presidential debate to invigorate his candidacy by presenting himself as an equal who can solve problems Mr. Obama has been unable to.

President Obama and Mitt Romney squared off on Wednesday night in Denver in the first of three presidential debates.

The president implored Americans to be patient and argued that his policies needed more time to work, warning that changing course would wipe away the economic progress the country is steadily making. The two quarreled aggressively over tax policy, the budget deficit and the role of government, with each man accusing the other of being evasive and misleading voters.

But for all of the anticipation, and with less than five weeks remaining until Election Day, the 90-minute debate unfolded much like a seminar by a business consultant and a college professor. Both men argued that their policies would improve the lives of the middle class, but their discussion often dipped deep into the weeds, and they talked over each other without connecting their ideas to voters.

If Mr. Romney’s goal was to show that he could project equal stature to the president, he succeeded, perhaps offering his campaign the lift that Republicans have been seeking. Mr. Obama often stopped short of challenging his rival’s specific policies and chose not to invoke some of the same arguments that his campaign has been making against Mr. Romney for months.

At one point, Mr. Romney offered an admonishment, saying, “Mr. President, you’re entitled, as the president, to your own airplane and to your own house, but not to your own facts, all right?” He forcefully engaged Mr. Obama throughout the night, while the president often looked down at his lectern and took notes.

A boisterous campaign, which has played out through dueling rallies and an endless stream of television commercials, took a sober turn as the candidates stood at facing lecterns for the first time. Mr. Obama, who has appeared to take command of the race in most battleground states, seemed to adopt an air of caution throughout the evening that left some of his liberal supporters disappointed in his performance.

“Are we going to double down on the top-down economic policies that helped to get us into this mess,” he said, “or do we embrace a new economic patriotism that says, ‘America does best when the middle class does best’ “?

For much of the debate, the candidates commandeered the stage, taking control away from the moderator, Jim Lehrer of PBS, as they kept trying to rebut one other. At times, the moderator seemed as if he had walked off the stage, a result of new rules that were intended to allow for a deeper and more freewheeling discussion.

On a basic level it was a clash of two ideologies, the president’s Democratic vision of government playing a supporting role in spurring economic growth, and Mr. Romney’s Republican vision that government should get out of the way of businesses that know best how to create jobs.

Mr. Romney sought to use his moment before a prime-time audience of tens of millions to escape the corner Mr. Obama and his allies have painted him into, depicting him as an uncompromising adherent to policies that have been tried before. He instead turned the focus on his opponent’s record.

“You’ve been president four years. You’ve been president four years,” Mr. Romney said at one point. He ticked through a list of promises he said Mr. Obama had not lived up to, and said, “Middle-income families are being crushed.”

Neither candidate delivered that knockout blow or devastating line that each side was hoping for. Still, style points went to Mr. Romney, who continually and methodically pressed his critique of Mr. Obama. The president at times acted more as if he were addressing reporters in the Rose Garden than beating back a challenger intent on taking his job.

Throughout the evening, Mr. Romney escaped Mr. Obama’s attempts to pin him down on which deductions he would eliminate in his tax proposals.