December 4th, 2013
12:20 PM ET
11 months ago

Obama says wage and income gap eroding American dream

Updated 1:41 p.m. ET, 12/4/2013

Washington (CNN) – The growing gap between rich and poor Americans is threatening the ideals the country was founded upon, President Barack Obama said in remarks Wednesday that appeared to signal a leftward turn in his economic agenda.

Making sure that the U.S. economy works for every working American is "the defining challenge of our time," Obama said in a speech at the Center for American Progress, a liberal think tank. He later said the "dangerous and growing" income and opportunity gap is jeopardizing the notion that if people work hard, they can get ahead.

“The idea that so many children are born into poverty in the wealthiest nation on Earth is heartbreaking enough, but the idea that a child may never be able to escape that poverty, because she lacks a decent education or health care or a community that views her future as their own, that should offend all of us,” Obama said during his remarks.

To combat the chasm between haves and have-nots, Obama called for a hike in the federal minimum wage, saying an increase is a good step for families and the economy as a whole.

Democrats on Capitol Hill have pushed for an increase in the federal minimum wage, which currently stands at $7.25 an hour. A proposal would boost it to about $10, and the White House has said Obama supports such a measure.

On Wednesday, Obama also made a general push to simplify the tax code, provide more work training in high schools, and make it easier for Americans to save for retirement.

Those are notions Obama has presented before; however, by packaging them into a clear plan for the next three years, Obama seemed to be making a play to revive his core of liberal supporters, who over the past several months have weathered the disappointments of his health care rollout and allegations of NSA spying.

Obama took sharp aim at Republicans during his remarks, saying they had failed to present their own plans for pulling Americans out of poverty.

“If Republicans have concrete plans that will actually reduce inequality, build the middle class, provide more ladders of opportunity to the poor, let's hear them. I want to know what they are,” Obama said.

And he made a forceful call for lawmakers to extend emergency unemployment insurance by the end of the year, saying “Christmastime is no time for Congress to tell more than one million of these Americans” they’ve lost those benefits.

The speech came as public approval of Obama sinks to new lows. The botched rollout of HealthCare.gov, coupled with stories of people losing their health plans, has contributed to the drop, but more Americans also say they disapprove of the President's handling of the economy, five years after the downturn.

A CNN/ORC Poll taken in November showed 59% of respondents said things were going badly in the country today. Thirty-nine percent - a plurality - said economic conditions are getting worse.

While Wall Street indexes and corporate earnings have reached new highs, the situation for low and middle class Americans has largely remained dire, including a jobless rate that remains high and scores of people who have given up looking for work.

The current economy is “profoundly unequal,” Obama proclaimed on Wednesday.

“Growing inequality and lack of upward mobility that has jeopardized middle-class America's basic bargain, that if you work hard, you have a chance to get ahead,” Obama said. “I believe this is the defining challenge of our time, making sure our economy works for every working American.”

The problem of income disparity, and the fight for a higher minimum wage, have gained renewed attention in the past weeks - low wage fast food workers have staged one-day strikes across the country demanding higher paychecks, and protesters stood outside Wal-Marts and other box stores on Black Friday demanding employees be paid better.

Obama's remarks Wednesday took place at a theater and arts facility in Washington's Southeast quadrant, an area of the capital where incomes remain low and 45% of the population lives below the poverty line.


Filed under: Economy • President Obama • Washington D.C.
soundoff (397 Responses)
  1. Hank

    People underestimate what an increase in the minumum wage would do to the economy. They think simply of a greedy fatcat executive who isnt willing to give back just a little bit of his money. The fast food industry, at the heart of this has very low profit margins. 80% of fast food locations are franchised. they are not tied to corporate earnings the owners in fact are small business owners who cant absorb the increased wages like corporate could. in turn they must layoff workers or cut hours only hurting the livelihood of these workers. minumum wage jobs are supposed to be a jump off point for peoples careers. people making a real living on minumum wages is untenable based on the realities of the economy.

    December 4, 2013 11:10 am at 11:10 am |
  2. Lynda/Minnesota

    @ Rudy: "The global financial crisis. People were committed to buying 90 day oil futures at higher prices, but global demand had suddenly dropped out the basement."

    Oh, Rudy. WAS there a "global financial crisis" in 2007-2008 (prior to Obama taking office)? I must have missed all the complications and economic turmoil.

    /snark

    December 4, 2013 11:10 am at 11:10 am |
  3. VEW2012

    Actually the highest gasoline prices ever recorded were in June 2008 at $4.28 per gallon that is still the highest national average. In mid November 2013 gasoline locally were $2.99 per gallon in my location, and they were less than that back in January 2009. Yesterday they were $3.01.

    December 4, 2013 11:11 am at 11:11 am |
  4. Nick

    One more distraction from Obamacare, Iran, etc.

    December 4, 2013 11:11 am at 11:11 am |
  5. Rebel

    The solution is not to raise the minimum wage. The solution is to stop the destroying of the dollar. Make the money people earn worth something equal to or more tomorrow. End the ponzi scheme that is destroying America.

    December 4, 2013 11:11 am at 11:11 am |
  6. tom l

    @Rudy,
    You're just a very small person. I don't work in the financial industry anymore. But what a shocker, you decide to make another false assertion about me. You are one pathetic individual. To have to lie to try and make a point is so pathetic. But you do it all the time so why should I be surprised.

    Maybe your buddy in your "gang", The Real TP, can bring up a post from me again from almost a month ago. That appears to be his M-O. So, Real TP, since you are so much better than me, morally and intellectually, are you ever gonna call Rudy on his lies about me? Since it's apparently my job to police the conservative posters, shouldn't it be your job to police the liberal ones?

    December 4, 2013 11:12 am at 11:12 am |
  7. Matthew

    The minimum wage should be eliminated not raised.

    December 4, 2013 11:12 am at 11:12 am |
  8. Minnie Mouse

    The minimum wage should be between $9 and $9.50 per hour and not $15 an hour. I feel for all of the fast workers that are going to strike, because if they are already having a hard financial struggle, it will be harder for them if they lose jobs or get hours cut from striking. Unemployment pays less and takes time to get your first check. For everyone who makes less than $15 an hour in the fast food industry, just be happy that you have a job!!

    With $15 an hour, that means less jobs, hours cut, higher food prices on everything, the dollar menu will be out! A dollar cheeseburger will cost $3 or $4 and a combo meal will be $10 and up. Who could afford to eat out anymore?? All of the college degree people who are working are going to also want a raise, in fact $15 an hour maybe more than some of them are even earning.

    $15 an hour is an unfair wage for an unskilled worker and will cause a huge impact on the economy if this does ever happen.

    Our government needs to be pushing for minimum wage raised gradually over a period of 5 years for all jobs (like .50 per year) yearly or quarterly bonuses on all jobs, costs of living wages each year on all jobs. All people who are not elderly or disabled who are on entitlement programs to take advantage of the Pell Grants and go to college and get educated to become independent upon themselves, so they can earn higher wages.

    December 4, 2013 11:12 am at 11:12 am |
  9. TomGI

    "Obama to push minimum wage hike"

    Not really 'push' just give a speech or two about it, 'speech maker in chief'

    December 4, 2013 11:13 am at 11:13 am |
  10. Me

    foxghostwriter

    tom I, I think the recession might just have had more to do with the gas prices than Obama. But hey, we might as well blame the comet dying on Obama as well.

    New conservative talking point: A vote for Obama is a vote for a comet killer!!!!!
    ____________
    Are you kidding, the recession is over right, have prices come down?? Prices raised a lot during the 2001/2002 recession with Bush but how FAST did prices return to their pre-recession levels, about a year is all it took!!! How long has it been now, 2, 3, 4 years......depending on when you believe the recession was actually over. But no NOTHING is Obummers fault.....LOL Guess what, a president's policies DO affect prices and the economy they might not control it but it does have an effect that is for sure!

    December 4, 2013 11:14 am at 11:14 am |
  11. carlin123

    What world are you from Mr. Obama?

    December 4, 2013 11:15 am at 11:15 am |
  12. Rudy NYC

    Me wrote:

    "Any employer who wants dedicated employees should pay them enough to earn that dedication. But, hey. This country's economy was founded on slave laborr. The U.S. economy has thrived since the Civil War by paying a segment of the population slave wages. usually the currrent wave of immigrants claiming to work harder than the previous wave and the former slaves."

    come on Rudy let's be real, if you want to see slave wages go to some third world countries where they are paid $5 a week or even a month. Our "slave labor" employees make MORE then that in an HOUR!!!! Stop being such a drama queen!!!
    ----------------------
    TRANSLATION: "I have no credible response to what Rudy posted, because it is absolute truth. So, I'll attack the messenger. Later today and this week, I'll have to call him a liar again."

    December 4, 2013 11:15 am at 11:15 am |
  13. Peppy

    Enjoy the new norm. Is there anything bamman can do right ??? This admin is just inept. Too many blunders to list.

    December 4, 2013 11:16 am at 11:16 am |
  14. Me

    Minnie Mouse

    The minimum wage should be between $9 and $9.50 per hour and not $15 an hour. I feel for all of the fast workers that are going to strike, because if they are already having a hard financial struggle, it will be harder for them if they lose jobs or get hours cut from striking. Unemployment pays less and takes time to get your first check. For everyone who makes less than $15 an hour in the fast food industry, just be happy that you have a job!!

    With $15 an hour, that means less jobs, hours cut, higher food prices on everything, the dollar menu will be out! A dollar cheeseburger will cost $3 or $4 and a combo meal will be $10 and up. Who could afford to eat out anymore?? All of the college degree people who are working are going to also want a raise, in fact $15 an hour maybe more than some of them are even earning.

    $15 an hour is an unfair wage for an unskilled worker and will cause a huge impact on the economy if this does ever happen.

    Our government needs to be pushing for minimum wage raised gradually over a period of 5 years for all jobs (like .50 per year) yearly or quarterly bonuses on all jobs, costs of living wages each year on all jobs. All people who are not elderly or disabled who are on entitlement programs to take advantage of the Pell Grants and go to college and get educated to become independent upon themselves, so they can earn higher wages.
    ___________________
    Very well said you nailed it!!!

    December 4, 2013 11:17 am at 11:17 am |
  15. Paul

    It will be even more of those working minimum wage. Obama is killing small business. Small business owners are competing with gov handouts (and you have to do nothing for that).
    The higher the wage the more it will cost YOU at the end. You can't play with free markets.
    =======================================

    .....Go to school get a degree in something that matters and get a real job.

    ++++++++++++++++++++++++++++++++++++++++++++++++++++

    Yeah, tell that to all the college graduates who can't find jobs and are stuck working a minimum/low wage job – IF they can even find one!

    December 4, 2013 10:58 am at 10:58 am |

    December 4, 2013 11:19 am at 11:19 am |
  16. Jim

    I worked hard and went deep in debt to finish graduate school while supporting a family. If those that didn't get a 38% raise, then I want one as well.

    December 4, 2013 11:19 am at 11:19 am |
  17. S.B. Stein

    It would be nice to have a raise of the minimum wage. It has been stated that would hurt businesses, but the wage was put into place so people would be able to live on what they make. You can't live on 40 hours a week of minimum wage in most places. If the wealthy would bother to have a group effort to support food pantries, a national non-profit health insurance, and job training centers across the country, then we would have a better society. It would also have me feel more comfortable with the huge salaries that many of these people get.

    December 4, 2013 11:20 am at 11:20 am |
  18. BradKT

    Democratrs simply do not understand how money works in a cpaitalist economy. They only kniw how to spend it. Increasing the minimum wage will only reduce hiring by small and medium sized businesses and increase inflation.

    December 4, 2013 11:20 am at 11:20 am |
  19. Rudy NYC

    tom l

    @Rudy,
    You're just a very small person. I don't work in the financial industry anymore. But what a shocker, you decide to make another false assertion about me. You are one pathetic individual. To have to lie to try and make a point is so pathetic. But you do it all the time so why should I be surprised.
    --------------------------
    False assertion? You just posted the definitive false assertion. Yesterday you tell us that you worked in the financial industry. Today, I repeat *your* claim, but now you're telling us that you no longer work there, which makes me a liar. How right wing of you.

    December 4, 2013 11:20 am at 11:20 am |
  20. Sam Smith

    I would support the President, as long as the minimum wage becomes $15 per hour. Wait, it will be better to make it $20/hour. Scratch that, so that it becomes a liiving wage, let's make it $30/hour. Wait, I want for workers to be able to afford nice housing, so let's just make it $100/hour !! That's it, the economy will blossom then!!

    December 4, 2013 11:22 am at 11:22 am |
  21. Bert974

    Pres. O'Bama is the one behind the McDonald's strikes.

    December 4, 2013 11:22 am at 11:22 am |
  22. Hey man

    So not only will I have to pay more for things because people will be paid more....I'll also be getting less buying power with what I make. So my 18 an hour is not really a big deal. Highly doubt they'll want to pay me more just because that went up.

    December 4, 2013 11:23 am at 11:23 am |
  23. oreo

    Malorey Archer –
    Perhaps you should look up 'classical liberal'. Moreover, you clearly cannot refute my claim.
    A higher min wage will ONLY benefit those that (for some reason) are currently producing more then their current min wage compensates, these people will indeed enjoy higher wages and keep their jobs, HOWEVER the younger and unskilled are left out because their skill set does not warrant the higher set min wage. Why not make the min wage $1000 a hour if so beneficial to the greater good?

    December 4, 2013 11:24 am at 11:24 am |
  24. Phil Tuncap

    I agree with Hank. This would be a bad move indeed.

    December 4, 2013 11:24 am at 11:24 am |
  25. Jake

    What good is raising minimum wage? Further weakening the dollar? Even at $10 an hour, 15 or 20 percent of your paycheck is still wasted on gas to get to work. How about "energy independence", and doing away with entitlement programs so the working class can keep more of their earnings and stop sending it to Saudi Arabia!? Our country's leadership sucks entirely.

    December 4, 2013 11:25 am at 11:25 am |
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